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Artificial Intelligence can (AI) revolutionize the world of finance and potentially make individuals wealthier

Artificial Intelligence can (AI) revolutionize the world of finance and potentially make individuals wealthier
Published 2 years ago on Jun 06, 2023

As businesses accelerate their AI initiatives, it raises the question of whether human financial advisors will become obsolete in the coming years, with computers offering faster and more cost-effective alternatives.

To evaluate the likelihood of this scenario, Dailymail.com turned to ChatGPT for answers to four fundamental investment-related questions and sought insights from financial experts to analyze the results.

Financial planner Marissa Reale, who has advised over 300 clients, said ChatGPT's service was too impersonal and was more like a comprehensive Google search 

Question: How do I start investing?

ChatGPT responded with a comprehensive 538-word answer, providing 11 steps for beginners to consider. The steps included setting financial goals, establishing an emergency fund, educating oneself, determining risk tolerance, starting with a retirement account, opening a brokerage account, determining asset allocation, investing in low-cost index funds or ETFs, monitoring and rebalancing the portfolio, and staying informed and adaptable. Notably, ChatGPT's response included disclaimers urging readers to consult with a financial advisor for personalized advice tailored to their specific circumstances.

The human experts agreed ChatGPT's response was good, broad-based advice but failed to offer a personalized service 

Experts' views:

Wealth manager Eric Mangold, based in New York, commended ChatGPT's advice as broad-based and suitable for self-directed beginners. He emphasized the importance of education and understanding risk tolerance. However, financial planner Marissa Reale noted that the advice lacked personalization, suggesting that seeking personalized advice is crucial in personal finance. She highlighted the need to consider individual factors such as high-interest debts and the client's specific circumstances when establishing an emergency fund.

Question: Should I invest in stock Nordisk?

ChatGPT's response began with a strong disclaimer, clarifying that it cannot provide personalized financial advice or specific investment recommendations. It then outlined seven general steps for considering investments, including researching the company, assessing industry and market conditions, analyzing financial indicators, considering valuation, understanding risks, diversification, and seeking professional advice.

Experts' views:

Anthony Martin, CEO of insurance firm Choice Mutual, cautioned against expecting specific investment advice from ChatGPT due to the lack of transparency in how the model processes data. He highlighted the potential bias and inaccuracies that could arise from relying on ChatGPT for investment decisions. However, Mangold praised ChatGPT's guidance, acknowledging its value in providing a structured approach and understanding risks.

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As businesses accelerate their AI initiatives, it raises the question of whether human financial advisors will become obsolete in the coming years, with computers offering faster and more cost-effective alternatives.

To evaluate the likelihood of this scenario, Dailymail.com turned to ChatGPT for answers to four fundamental investment-related questions and sought insights from financial experts to analyze the results.

Financial planner Marissa Reale, who has advised over 300 clients, said ChatGPT's service was too impersonal and was more like a comprehensive Google search 

Question: How do I start investing?

ChatGPT responded with a comprehensive 538-word answer, providing 11 steps for beginners to consider. The steps included setting financial goals, establishing an emergency fund, educating oneself, determining risk tolerance, starting with a retirement account, opening a brokerage account, determining asset allocation, investing in low-cost index funds or ETFs, monitoring and rebalancing the portfolio, and staying informed and adaptable. Notably, ChatGPT's response included disclaimers urging readers to consult with a financial advisor for personalized advice tailored to their specific circumstances.

The human experts agreed ChatGPT's response was good, broad-based advice but failed to offer a personalized service 

Experts' views:

Wealth manager Eric Mangold, based in New York, commended ChatGPT's advice as broad-based and suitable for self-directed beginners. He emphasized the importance of education and understanding risk tolerance. However, financial planner Marissa Reale noted that the advice lacked personalization, suggesting that seeking personalized advice is crucial in personal finance. She highlighted the need to consider individual factors such as high-interest debts and the client's specific circumstances when establishing an emergency fund.

Question: Should I invest in stock Nordisk?

ChatGPT's response began with a strong disclaimer, clarifying that it cannot provide personalized financial advice or specific investment recommendations. It then outlined seven general steps for considering investments, including researching the company, assessing industry and market conditions, analyzing financial indicators, considering valuation, understanding risks, diversification, and seeking professional advice.

Experts' views:

Anthony Martin, CEO of insurance firm Choice Mutual, cautioned against expecting specific investment advice from ChatGPT due to the lack of transparency in how the model processes data. He highlighted the potential bias and inaccuracies that could arise from relying on ChatGPT for investment decisions. However, Mangold praised ChatGPT's guidance, acknowledging its value in providing a structured approach and understanding risks.

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