AI’s Predictions of the Stock Market are Unreliable for Now

Artificial intelligence (AI) has often been hailed as the solution to various problems and inefficiencies in different industries. However, Wall Street veteran Marty Chavez believes that AI may not be the answer for predicting the stock market anytime soon. Speaking at the Bloomberg Invest conference in New York, Chavez explained that the successes of AI stem from its ability to take a large number of samples and dichotomize them. For example, training AI to identify cats in images is very successful because cats are stable and easily recognizable. However, the same cannot be said for the stock market, which is notoriously unpredictable and unstable. Chavez emphasized that the stock market is not a stable distribution, meaning that AI‘s ability to identify and classify patterns may not work in predicting market trends. As a result, Wall Street analysts and investors may have to stick to traditional methods of predicting market trends for now. Despite the hype surrounding AI, it seems that the stock market is not yet stable enough for AI to accurately predict its behavior.