AI could be capable of managing financial accounts autonomously within approximately five years.

catch22

I'd still be asking questions here for real world, brain power resolutions.

Enjoy.....

--- Based on statements from MIT researchers and experts, there's a strong belief that AI could be capable of managing financial accounts autonomously within approximately five years.
Specifically:
Andrew Lo, a finance professor and AI expert at MIT, believes large language models (LLMs) could have the technical ability to make real investment decisions for clients within five years. He envisions a future where AI can meet fiduciary standards, understand human emotions, and learn from feedback.
He also emphasizes the importance of human-machine collaboration, suggesting that combining human intuition with AI's capabilities could lead to optimal financial strategies.
Other MIT Sloan researchers highlight the increasing use of AI in finance, particularly for research, automation, and personalization of financial strategies, making insights more accessible and affordable.
While there's enthusiasm, it's also recognized that implementing AI in this context presents challenges, including reliability in high-stakes decision-making and ethical considerations, according to Bloomberg AI.
In summary, MIT experts like Andrew Lo foresee the potential for AI to autonomously manage financial accounts within the next five years, emphasizing the crucial role of AI meeting fiduciary standards and the benefits of human-machine collaboration in this evolving landscape.

Old_Joe

@Catch22- Hello there. Glad to see you posting a lot more. A question about the above- so much of financial success comes at the expense of the party on the other side of a trade. Assuming for the sake of discussion that everyone has the same AI advantage, how is that going to work out? Granted, financial success doesn't always require a "loser", but it sure seems that a lot does.

Mark

Hard pass. I'm perfectly capable of messing up my financial situation enough on my own TYVM.

hank

I’m afraid they might all decide to Sell at the same time.

yogibearbull

Investors should be wary of giving discretion to their brokers or financial advisors.
Double that for futuristic AI-Advisors.
The best I can see is to use AI financial tools to generate alerts that I can review & then decide to do something or not.

WABAC

Isn't it MIT that produced the research that shows that relying on AI destroys an individual's critical thinking skills, and that AI's regularly lie and deceive?

Why, yes, it was MIT. They're even studying how to tell if AI's are lying.

On a dataset of questions designed to test for social biases in language models, they found cases in which LLMs provide explanations that mask their reliance on social biases. In other words, the LLMs make decisions that are influenced by social identity information, such as race, income, and gender -- but then they justify their decisions based on other factors, such as an individuals' behavior.

rforno

to echo @Mark, over my dead body.....

sma3

How is using AI any different than the "Robo Advisors" people sign up for at Robinhood or Schwab "Intelligent Advisors"

They might be more responsive and able to learn your investing behavior by watching what you do as oppose to what you say you will do.

this is likely going to mostly affect folks that mange smaller account for 0.3% for example.

But maybe it will put cost pressure on the higher end fees too!

People who depend on "financial Planning" will be most affected I think.

It is hard to get an answer about IRMAA and income levels for example but AI could automate this easily. Of course anybody with minimal Excel knowledge can write a spreadsheet too; it is hard to understand why more are not avaliable

gman57

NOBODY cares about your money as much as you do....including AI.

WABAC

gman57 said:

NOBODY cares about your money as much as you do....including AI.

I dunno, private equity sure seems interested.

hank

Maybe AI likes Krispy Kreme … ? (article by Billy Duberstein)

Time to get back to reading Lewis Carroll’s ”Alice in Wonderland”. Makes more sense than today’s markets.

Mark

To me private equity is just another name for SPAC's. Remember them and when is the last time you've heard them mentioned?

There are no doubt some PE positions that do well, maybe very well, but I don't have the time or the resources to scope them out to any great depth and I'd just be relying on the word of those promoting them. I have to ask myself if they're so great and/or the next big thing then why are institutional investors (e.g. Yale, Harvard etc.) trying to get rid of them.

These aren't exactly new but promotion of them has certainly picked up. I used to own shares of some by virtue of my positions in some CEF funds managed by BlackRock, BST (Science & Technology and BME (Health Sciences). Each of their top-10 positions were littered with them. Today I can't see any of them. Project Kuiper, Amazon's low Earth orbit satellite broadband network was one of them. Have you ever heard of it? What's it doing today? Just one low brow opinion.