At least one in ten retail investors now uses chatbots to select stocks, which is fueling the growth of the robo-advisor market.
As Reuters reports, even proponents of this strategy argue that it is high-risk and cannot yet replace traditional consultants.
It is noted that thanks to artificial intelligence, anyone can now choose stocks, track them, and receive investment analysis that was previously available only to large banks or institutional investors.
According to the analytical company Research and Markets, the robo-advisor market, which includes all companies that provide automated financial advice based on algorithms (fintech companies; banks; asset management firms), will grow to $470.91 billion in revenue in 2029 from $61.75 billion last year. That is, according to experts, this market could grow by about 600%.
"Even the simple ChatGPT tool can do a lot and replicate a lot of the workflows that I used to do," said Jeremy Leung, a former Swiss investment banker who spent nearly two decades analyzing companies for UBS. However, he also warned that such a tool could miss some important analyses because it cannot access paid data.
A survey of 11,000 investors by broker eToro found that around 50% were willing to use AI tools like ChatGPT or Gemini, and 13% were already using them. In the UK, 40% of respondents said they had turned to chatbots and AI for personal finance advice.
ChatGPT itself warns that it should not be relied upon for professional financial advice. According to Dan Mochulski, managing director of eToro in the UK, it is best to use platforms that are built on AI and specifically trained to analyze the markets, because conventional AI models can misinterpret the numbers. They rely too much on pre-established facts and past price movements in trying to predict the future.
As we previously reported, OpenAI CEO Sam Altman believes the artificial intelligence market is in a bubble; his comments add to concerns among experts and analysts that investment in AI is growing too quickly.
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