Can and Should You Let ChatGPT Pick Your Investments?
ChatGPT has taken the world by storm, promising to change a host of industries and society in general for the better (although the “better” part is highly debated). ChatGPT is essentially a chatbot with enhanced artificial intelligence capability, allowing it to respond in a conversational manner to questions posed to it.
As such, people around the world are using it to look for information on a variety of topics, from the silly to the serious. Many are even asking potentially life-changing questions, such as “can you pick my investments?” But is ChatGPT even qualified to give these types of answers, and should you rely on it for this type of information? Read on to learn more.
Can ChatGPT Pick Stocks?
While it may seem like ChatGPT can do anything, the truth is that it’s not qualified to pick stocks — and it knows this. If you ask ChatGPT which stocks you should buy, here is the response you’ll get:
As an AI language model, I cannot provide specific investment advice or recommend specific stocks to buy. Investing in stocks involves significant risks and requires careful consideration of your financial goals, risk tolerance, and investment timeframe.
It is always advisable to do your own research and analysis before making any investment decisions. You may consider consulting with a financial advisor or using online tools that can help you assess your investment goals and risk tolerance.
Additionally, you may want to consider diversifying your investment portfolio across different asset classes and sectors to help reduce risk and increase potential returns. It is also important to keep in mind that past performance is not a guarantee of future results, so any investment decision should be made after thorough research and analysis.
Can ChatGPT Help With Your Investments?
You might not be satisfied with ChatGPT’s response if you ask it to pick stocks for you. However, the answer it gives can actually help you more than you think. For starters, it’s a reminder that you shouldn’t put blind faith in a chatbot on the internet, even if it has received all the fame and publicity as ChatGPT. But more importantly, the response that ChatGPT offers provides a host of valuable information that you can actually use.
First, ChatGPT stresses that when you build a portfolio, you should incorporate your investment objectives, timeframe, and risk tolerance. Those are solid financial principles that any financial advisor will similarly offer.
Next, the online bot encourages you to research and analyze your stock picks, and perhaps enlist the use of a financial advisor.
Lastly, the AI recommends that you diversify your portfolio – also the type of financial recommendation that most advisors will offer.
At the end of the day, ChatGPT is excellent at certain tasks, such as locating and accessing information that may be helpful to your queries, but it’s not yet capable of making advanced decisions. You could likely get the same answers by performing your own thorough searches on Google, but ChatGPT nicely assembles the highlights of what you’d likely find into a streamlined, easy-to-read format.
Ways To Use Artificial Intelligence To Help Your Portfolios
If you’re interested in actually using artificial intelligence to help you build a portfolio, consider using a robo-advisor. The models and exchange-traded funds offered by a robo-advisor are chosen and created by flesh-and-blood portfolio advisors. However, the matching of your self-reported investment objectives and risk tolerance with a properly allocated portfolio is the work of the algorithm embedded in the robo-advisor.
Some robo-advisors don’t even charge an annual management fee, meaning for the same price as you pay to use ChatGPT, you can get much more actual investment assistance.
The Future Is Coming
ChatGPT is making headlines as a user-friendly technology that can change the world. While it’s not quite there yet in terms of making investment recommendations, it might not be long before it or others like it become the behind-the-scenes input that professional managers use to guide their decisions.
According to a Harvard Business Review article by Antonio Nieto-Rodriguez and Ricardo Viana Vargas titled “How AI Will Transform Project Management,” research by Gartner suggests that 80% of project management tasks will be handled by AI and powered by big data and machine learning as soon as 2030. This includes number-intensive projects like portfolio optimization.
However, the bottom line is that at the present time, ChatGPT can provide you with useful financial information and principles, but it can’t pick your investments for you.
More From GOBankingRates
- How To Get Free Money: 13 Proven Ways
- Successful Retirees Master These 7 Money Moves To Keep Their Retirement Funds Secure
- 3 Things You Must Do When Your Savings Reach $50,000
- How to Save $200,000 Cash By Improving Your Credit Score
