As the world becomes more automated, ChatGPT and artificial intelligence (AI) is slowly but surely infiltrating every industry imaginable. One sector where AI is beginning to make its mark is finance, and according to new research from the University of Florida, AI chatbots may even be able to beat the stock market.
What is ChatGPT?
ChatGPT is an AI algorithm developed by Silicon Valley start-up OpenAI. It’s what is known as a “large language model”, meaning it has been trained on billions of internet pages and millions of books to help it better understand text. Its abilities include being able to analyze news headlines and make predictions about whether the price of a share will rise or fall.
How accurate is ChatGPT at predicting stock movements?
The University of Florida’s research found that ChatGPT was, in many cases, more accurate than other “sentiment analysis” tools used by financial analysts. The researchers compared ChatGPT’s answers to real share price movements from historical data and found that the bot showed “statistically significant predictive power on daily stock market returns.”
Can AI replace financial analysts?
While AI chatbots like ChatGPT may be able to predict stock market movements, they are still not perfect. Large language models like ChatGPT are notoriously poor at analyzing numbers, and the tests were performed on past market data rather than up-to-date live information.
Furthermore, the accuracy of these AI models is not yet at a level that would enable them to completely replace human analysts. Instead, they are more likely to be used to supplement the work of financial analysts, rather than replace them entirely.
What are the implications of AI chatbots for the finance industry?
According to Alejandro Lopez-Lira, one of the authors of the paper, AI chatbots like ChatGPT “certainly” have implications for the employment of financial analysts. However, he also notes that the question is whether it’s more cost-effective to pay analysts or to put textual information into a model.
The rise of generative AI in marketing
The use of generative AI, which creates content based on a set of parameters or input, is also beginning to make waves in the marketing industry. One of the world’s largest marketing agencies, BlueFocus, has announced that it will “fully and indefinitely” stop hiring human creative staff in favor of generative AI technology.
BlueFocus, ranked as the 11th biggest marketing agency in the world, said it would hire fewer people and focus on ChatGPT-style AI technology instead. The agency’s bosses had “decided to completely stop four outsourcing expenditures related to creative design, program writing, copywriting, and short-term employees indefinitely.”
Will AI replace human copywriters?
While generative AI is likely to make certain aspects of copywriting easier, it is unlikely to completely replace human copywriters. Companies will still need human creativity to come up with innovative ideas and produce high-quality content.
AI chatbots like ChatGPT are making significant strides in the finance industry, with their ability to analyze news headlines and make predictions about stock movements. However, they are not yet accurate enough to completely replace human analysts.
In the marketing industry, generative AI is beginning to be used to automate certain tasks, but human creativity will still be essential to producing high-quality content.
As AI continues to evolve and become more sophisticated, it is likely that we will see more and more industries adopting these technologies. However, it is also important to remember that AI is a tool that should be used to supplement human abilities, not replace them entirely.