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A stock portfolio created by ChatGPT is outperforming the top UK investment funds

Phil Rosen   

A stock portfolio created by ChatGPT is outperforming the top UK investment funds
  • ChatGPT created a portfolio of 38 stocks, and the bot has outperformed top competitors in the UK.
  • In eight weeks, the theoretical portfolio has generated 4.9% returns, versus a loss of 0.8% for the top 10 UK funds.

A theoretical stock portfolio of 38 companies picked by ChatGPT has outperformed the 10 most popular funds in the UK over an eight week stretch, according to finance website Finder.com.

The AI-powered fund has climbed 4.93% in the eight weeks since March 6, 2023, while the group of competing funds together averaged a loss of 0.78% in the same period. The bot-picked fund has outperformed the real funds in 34 of the 39 market days the experiment has been running, the report said.

The top three performing stocks in the ChatGPT portfolio were Meta, Microsoft, and Intel Corporation, which saw increases of roughly 30%, 20%, and 18%, respectively.

Other names that rounded out the portfolio include Visa, Home Depot, Johnson & Johnson, Nvidia, and Netflix.

Finder asked the AI large language model to pick stocks using a range of investing principles taken from the leading funds, the website said, and the study bypassed ChatGPT's warning that it "cannot provide specific investment advice" by adding that it was a theoretical exercise.

"The big question is how bad of an idea using ChatGPT for investing research currently would be," Finder chief executive Jon Ostler said. "Big funds have increasingly been using AI for years, but the public using a rudimentary AI platform that openly says its data is patchy since September 2021 and lacks the intricacies of market psychology, doesn't sound like a good idea."

Some of the UK funds that were used in comparison to the ChatGPT portfolio including Fundmsith, Vanguard LifesStrategy 80% Equity, and Fidelity Index UK P Acc.

In a separate survey, Finder also noted that about 19% of UK adults said they would consider getting financial advice from ChatGPT, and a further 8% said they were already doing so.

More than one third of Brits said they weren't sure what ChatGPT was.

Ostler pointed out that another 2021 survey found that half of British investors use social media to get investing advice. Using AI, in his view, could be a wiser choice than relying on an "unqualified TikTok star," but ideally people shouldn't rely on either for their entire investing education.

"Spending time researching via known primary sources or a qualified advisor would be the safer and recommended approach," he said, "but this may not be the case for ever."


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