As more people become familiar with artificial intelligence (AI), more are turning to ChatGPT for investing advice. According to a 2023 survey by The Motley Fool, an astounding 47% of Americans said they have used or are considering using the technology for investing purposes. While ChatGPT could be a great starting point for some people, there are risks to consider before relying solely on AI for managing finances.
ChatGPT is a revolutionary new artificial intelligence technology launched in November 2022. It can easily analyze technical data such as financial statements and earnings calls, making it attractive to rookie investors. However, ChatGPT has admitted it does not have complete knowledge and understanding of what has occurred since September 2021. This means that there is potential for inaccurate or harmful advice.
Perhaps most concerning is that ChatGPT is not personalized. A person’s investment goals are major factors in how and where to invest, and AI’s one-size-fits-all approach could prove to be dangerous. For example, someone saving for a down payment on a house might have a different timeline than someone looking to save for retirement. If AI isn’t tailored to individual goals, it could result in investments against an investor’s best interest. Additionally, ChatGPT can’t gauge risk tolerance, and so people may be pushed into investments that are too risky for their comfort.
AI has its advantages, and there is immense potential within ChatGPT and similar AI investment technology. However, it is important to research a company thoroughly using tools available, such as those from The Motley Fool, to double check the data that ChatGPT is providing. Additionally, those considering an investment should take into account their timelines and risk factors. AI projects have plenty of potential, but it is important to always consider your own investing goals before relying solely on the technology.
The Motley Fool is a leading financial media company with a mission to help people make smarter decisions about their finances. With its team of analyst and publishers, The Motley Fool aims to provide helpful and entertaining investment advice to everyday investors. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool provides stock market and investing insights as well as publishes a series of books and podcasts.
