I’m Not Unbiased

Warning: This post is a rant and involves some foul language. Enjoy!

There’s a ridiculous amount of research supporting the idea that humans engage in an incredible amount of deception and even self-deception. People are biased. People respond to the incentives they face. Of course, anyone who has ever interacted with another human knows these things.

Despite this, pretty much every website offering third-party evaluation makes claims of objectivity or independence. Not claims that they try to minimize bias. Claims that they actually are unbiased.

Let’s take TopTenReviews, a site I criticized in a previous post. TopTenReviews says things like:

To be clear, these methods of monetization in no way affect the rankings of the products, services or companies we review. Period.
Bullshit. Total bullshit.

deceptive fish

I’ve complained enough in the past about run-of-the-mill websites offering bogus evaluations. What about the websites that have reasonably good reputations?


NerdWallet publishes reviews and recommendations related to financial services.

Looking through NerdWallet’s website, I find this (emphasis mine):[1]

The guidance we offer, info we provide, and tools we create are objective, independent, and straightforward. So how do we make money? In some cases, we receive compensation when someone clicks to apply, or gets approved for a financial product through our site. However, this in no way affects our recommendations or advice. We’re on your side, even if it means we don’t make a cent.
Again, bullshit.

NerdWallet meets Vanguard

Stock brokerages are one of the types of services that NerdWallet evaluates.

One of the most orthodox pieces of financial advice—with widespread support from financial advisors, economists, and the like—is that typical individuals who invest in stocks shouldn’t actively pick and trade individual stocks.[2] This position is often expressed with advice like: “Buy and hold low-cost index funds from Vanguard.”

Vanguard is a firm that has optimized for keeping fees low and giving its clients a rate of return very close to the market’s rate of return.[3] In fact, the firm’s founder, John Bogle, is famous for creating the first low-cost index funds.

Since Vanguard keeps costs low, it cannot pay NerdWallet the kind of referral commissions that high-fee investment platforms offer. So what happens when NerdWallet evaluates brokers? NerdWallet uses a silly evaluation methodology that results in a shitty rating for Vanguard.

Vanguard gets 3 out of 5 stars.[4] It’s the worst rating for a broker I’ve seen on the site.[5]

How does Vanguard’s mediocre rating get rationalized? NerdWallet slams Vanguard for not offering the sort of stuff Vanguard’s target audience doesn’t want. Vanguard gets the worst possible ratings for the “Promotions” and “Trading platform” categories. Why? Vanguard doesn’t offer those things.[6]

Imagine a friend went to a nice restaurant and came back complaining that her steak didn’t come with cake frosting. NerdWallet is doing something kind of like that.

The following excerpt is found on NerdWallet’s Vanguard review under the heading, “Is Vanguard right for you?” (emphasis mine):

Ask yourself this question: Are you part of Vanguard’s target audience of retirement investors with a relatively high account balance? If so, you’ll likely find no better home. You really can’t beat the company’s robust array of low-cost funds.

Investors who fall outside of that audience — those who can’t meet the fund minimums or want to regularly trade stocks — should look for a broker that better caters to those needs.

This is silly. Vanguard’s minimum is $1,000.[7] You shouldn’t buy stocks as an investment strategy if you have less than $1,000 to put into stocks![8] If you invest in stocks, you shouldn’t regularly trade individual stocks![9]

From my perspective, NerdWallet is saying that if you are (a) the typical kind of person that should be buying stocks and (b) you don’t use a stupid strategy, then “you really can’t beat the company’s [Vanguard’s] robust array of low-cost funds.”

So there we have it. Despite the lousy review, NerdWallet correctly recognizes that Vanguard is awesome.

NerdWallet didn’t really lie, but it’s biased.

thumbs down

To be clear, I’m being hard on NerdWallet. NerdWallet does a good job aggregating information about financial services and offers decent financial advice in some areas. The evaluation methodology I’m criticizing may not have been maliciously engineered to optimize for profits. NerdWallet may have stumbled into the current methodology. Still, there’s a big problem. NerdWallet’s current methodology is good for its bottom line, so it has a strong incentive not to correct obvious issues. On the other hand, if NerdWallet stumbles into a silly methodology that’s bad for its bottom line, it has a huge incentive to change the methodology.


Sometimes evaluators aim to create divisions between editorial content (e.g., review writing) and revenue generation. I think divisions of this sort are a good idea, but they should not be thought of as magic bullets that eliminate bias. WireCutter is one of my favorite review sites, but I think it makes the mistake of overemphasizing how much divisions can do to reduce bias:[10]

We pride ourselves on following rigorous journalistic standards and ethics, and we maintain editorial independence from our business operations. Our recommendations are always made entirely by our editorial team without input from our revenue team, and our writers and editors are never made aware of any business relationships.
I believe WireCutter takes actions to encourage editorial independence. However, I’m skeptical of how the commitment to editorial integrity is described. Absent extreme precautions, people talk. Information flows between coworkers. Even if editors aren’t intentionally informed about financial arrangments, it’s easy to make educated guesses. Commission rates offered by Amazon’s affiliate program are publicly available.[11]

Bias is sneaky

Running CoverageCritic, I face all sorts of decisions unrelated to accuracy or honesty where bias still has the potential to creep in. For example, which industries should I cover? Industries where companies almost always offer commissions or industries where it’s hard to get a cut from any sales I generate? In what order should providers I recommend by displayed? Alphabetically? Randomly? One of those options will probably be better for my bottom line than the other.

I don’t have perfect introspective access to what happens in my head. A minute ago I scratched my nose. I can’t precisely explain exactly how or why I chose to do that. It just happened. Similarly, I don’t always know when and how biases affect my decisions.

I’m biased

I have conflicts of interest. Companies I recommend offer commissions. You can take a look at the arrangements here.

I try to align my incentives with consumers by building my brand around commitments to transparency and rigor. I don’t make these commitments for purely-altruistic reasons. If the branding strategy succeeds, I stand to benefit a lot.

Even with my branding strategy, my alignment with consumers will never be perfect. I’ll still be biased. If you ever think I could be doing better, please let me know.