Global Courant 2023-04-27 22:52:38
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Applying artificial intelligence to finance is all the rage, and a new investment platform has taken it to another level.
enlarge is one of the first investment platforms to use ChatGPT and computer programs to provide personalized, data-driven investment advice. Not only does it answer investor questions in human conversations, it also monitors individual portfolios and guides users through market-moving events like rate hikes and earnings reports. And there’s a bonus: it works like a brokerage where you can trade stocks and ETFs instantly.
“It’s a copilot for the self-directed investor,” Vinay Nair, founder of Magnifi, said in an interview. “Today, brokers have democratized access to trading and markets, but they lack intelligence and personalization for the user. Magnifi seeks to democratize intelligence in a personalized way.”
As AI continues to make breakthroughs, Wall Street is becoming increasingly curious about how the technology could disrupt asset management operations. A recent preliminary study showed that ChatGPT, the world’s most popular AI tool, could have the potential to improve investment decision-making.
To see how Magnifi performs and how it competes with professional advisors, I asked it a few different questions.
First I asked the question “what stocks would Warren Buffett buy?” It came back with an explanation of its principle of value investing, along with the greatest holdings of the “Oracle of Omaha”, Bank of America, Apple And Coca-Cola.
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The system was then able to compare these three stocks in terms of return and volatility over the past year.
Second, I wanted to see how Magnifi would help me navigate earnings season. I asked him what would happen to a hypothesis Amazon when the e-commerce retailer reports revenue.
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The robot showed me the earnings estimates of Wall Street analysts, as well as Amazon’s track record over the past few quarters.
Finally, I asked how interest rate hikes affect my imaginary portfolio, with iShares 20 Plus Year Treasury Bond ETF as one of my holdings. It told me that rising interest rates could negatively impact bond funds like TLT, with examples of historical performance in similar environments.
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Nair said many investors tend to ask general questions like “how do I get started?” But the more users involved, the more input the system can collect and the more personalized answers it can provide, according to the founder.
The platform charges a flat fee of $14 per month, and Nair said his firm does not make any money from trading or paying for order flows.
“It’s a very customer-oriented model, which gives us no incentive to directly or indirectly get them to over-trade,” Nair said.
