ChatGPT AI-generated stock portfolio experiment outperformed some leading investment funds in the United Kingdom (UK), Finder.com says.
In an experiment, the viral AI chatbot of the Microsoft-backed OpenAI hand-picked various stocks based on investing principles that the top funds in the UK also employ.
ChatGPT AI-Generated Stock Portfolio vs. Top UK Funds
According to the Financial Times, the AI-powered ChatGPT made more gains than the top 10 investment funds in the UK in eight weeks. The AI chatbot created a theoretical stock portfolio comprising nearly 40 companies.
In the past eight weeks, or roughly two months, the AI-generated fund showcased at least a 4.9 percent increase. On the flip side, the top British investment funds booked an average loss of 0.8 percent, contrary to the gains the ChatGPT portfolio saw.
Markets by Business Insider reports that the ChatGPT-created fund includes 38 top-performing companies. Some top picks are tech giants like Microsoft, Meta, and Intel. Microsoft, which backs the development of ChatGPT, saw a whopping 30% increase in the last three weeks, whereas the Facebook parent rose by 20%. Meanwhile, Intel climbed by roughly 18%.
The AI-generated fund also included other giant companies like Home Depot and Nvidia. The streamer Netflix and the multinational brand Johnson & Johnson are also some of the top picks.
Finder.com reportedly prompted the AI chatbot to choose stocks based on investing principles that the top investment funds subscribe to. Finder Chief Executive Officer (CEO), Jon Ostler, says they initially want to find out "how bad of an idea using ChatGPT for investing research currently would be."
On the other hand, the leading UK funds that were used to compare against the AI-created portfolio include the Vanguard LifesStrategy 80% Equity and Fidelity Index UK P Acc.
ChatGPT AI as Portfolio Manager?
Business Insider notes that roughly 19 percent of adults in the UK are considering turning to ChatGPT for financial advice, a Finder.com survey shows. With the unprecedented growth of generative AI services like ChatGPT, some wonder if they might be a good financial trading buddy.
As per CNBC, a recent research entitled "Can ChatGPT Improve Investment Decisions? From a portfolio management perspective" looked into the ability of the AI chatbot to choose which asset might perform well.
The study showed that the AI-generated asset portfolio showcased a better performance than the randomly selected counterpart regarding risk-adjusted return.
Although recent experiments suggest that ChatGPT could dabble in investments, OpenAI warns users that the AI chatbot still "cannot provide specific investment advice." To bypass this warning, Finder.com says that it was a theoretical experiment.
