, OpenAI's conversational chatbot are all over the media, it is difficult to find what the AI simply cannot do. However, the ingenuity of humans shone through one more time as somebody asked the chatbot for stock market advice.
ChatGPT responded that the stock market was too hard to predict and that it did not have access to live stock data. However, ETF Managers Group, in partnership with a fintech firm Equbot has been using AI to pick holdings in the $102 million AI-powered Equity ETF since 2017. The fund has doubled the returns on the Vanguard Total Stock Market ETF this year.
Instead of simply relying on standard market data as available from the likes of Bloomberg or S&P, AIEQ also looks through unstructured data such as earnings calls, keyword data, and tweets, Chris Natividad, Chief Investment Officer at Equbot toldWhile the VTI was up 6.7 percent up to Jan 27 this year, AIEQ was up 13.5 percent in the same period.
The difference in the returns assumes significance when one considers that the VTI's portfolio has nearly 4,000 securities as against AIEQ's 114. Considering that the AI uses machine learning to pick its stocks, it is perhaps only now that the bot is getting better at it and the near future will demonstrate what it is really capable of.
Probably.