Are You Using AI to Pick Stocks? Read This...

A few months ago, I read news about an eight month pregnant lady in the US crediting ChatGPT for saving her and her unborn baby's life.

A casual query from her about the tightness in her jaw to the AI chatbox led to an urgent message to check blood pressure, and to run to the hospital. Her BP had indeed spiked to a dangerous level, and the doctors had to deliver the baby on an emergency basis.

Ever since ChatGPT made it to limelight, the AI expert with the human touch is all the rage.

Whether it's handling a relationship, navigating a delicate situation at the workplace, or taking up a new project, the learning curve for cerebral and emotional skills has been compressed, even skipped.

Until a few years ago, this seemed a futuristic concept - utopian or dystopian depending on your world view and experiences.

In the movie 'Her', a lonely writer develops an unconventional relationship with an AI operating system (a female voice on his computer).

The bond deepens over a few months, until the writer panics when the voice is briefly unavailable and goes offline. His world falls apart as he further realises 'she' has been talking to thousands of other users.

For him, a personal relationship has been violated. When I watched it in 2017, it came across as an exaggerated science fiction.

Well, not anymore. AI chat boxes, powered by huge language models and trained on vast amounts of data to understand and interact with humans are a reality. And many are seeking refuge in it. People are shunning therapists in favour of ChatGPT and others like it.

It's not just emotional issues that ChatGPT is the go-to tool for. People are asking it to analyse their portfolio and advise them. And Chatgpt, as always is honouring the requests.

Should we be worried?

Well honestly, I do think a lot more people could turn to it. But whether Chatgpt can do justice to that trust is something I am not sure about.

"I know too much, but I understand so little."

Well, that's a confession from ChatGPT itself. While it can share a lot of information that could have taken days for you to gather without it, it can only 'sound' wise, without being wise.

So yes, I as an analyst think that it reduced the information edge that analysts had.

Being early in investing helps. There was a time when a certain smart investors and analysts had a huge lead over a common investor. That edge is shrinking. With a few prompts, it's possible to get information in a much shorter period than what you would have needed a few years ago.

The same might be true to some extent of for the analytical edge as well. With the LLM (large language models) taking over, you could use prompts to get AI platforms to do analysis for you.

However, where AI is likely to fail is developing a behavioural edge. That comes from the discipline and a process-oriented approach - real world experience. While AI gives you what you want because predictive generation is what they are trained for, it may fail at what you need.

This could make a big difference to your investing approach and results.

Another risk is that AI can make stuff up and sounds confident while doing so. It can tell you have a gastroenterological infection and convince you to rush to the hospital, when the actual issue is an anxiety attack. I'm not making this up. It has already happened.

As the man behind ChatGPT, Sam Altman, warns...

• “People have a very high degree of trust in ChatGPT, which is interesting, because AI hallucinates. It should be the tech that you don't trust that much.”

No wonder then that the market regulator has suggested that professionals using such tools should provide clear disclosure to clients about their usage. The regulator can only make rules around transparency. It's the buyer that must beware.

So, what do you think? Will you ever consider replacing human analysts and advisors with ChatGPT and the like?

Let me know your thoughts.

Warm regards,


Richa Agarwal
Editor and Research Analyst, Hidden Treasure
Quantum Information Services Private Limited (Research Analyst)