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When AI makes sharper stock predictions
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US regulators are increasingly concerned with AI’s risks in the financial services industry.
PHOTO: REUTERS
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A year ago, Mr Andrew Lo asked ChatGPT for its opinion on Moderna, a biotech stock that soared during the pandemic era. The advice: sell. He didn’t. The stock plunged.
Now Mr Lo, a finance professor at the Massachusetts Institute of Technology and leading artificial intelligence (AI) expert, believes the same kind of technology that nailed the stock call could soon do far more. Not just dispense advice, but manage money, balance risk, tailor strategies – and meet one of finance’s highest duties: acting in a client’s best interest. Within five years, he predicts, large language models (LLMs) will have the technical capability to make real investment decisions on behalf of clients.
