What has it done for the world of investing, and what can we expect in 2023 and beyond?

How Is AI Used in the World of Finance?

Artificial intelligence is already widely used by all kinds of financial regulatory bodies, both on the state and bank level, most notably to detect fraud. It is also used to speed up loan applications and quickly go through a large pile of documents. Financial AI solutions are also capable of making certain intelligent decisions based on the parameters they’ve been given.

Large banking and financial systems are also using AI to improve their customer service efforts, shorten waiting times and help customers solve their problems quickly. This reduces the amount of work human reps have to handle on a daily basis.

How Can AI Be Used in the World of Investing?

The biggest flaw humans have when it comes to investing is that they are not capable of completely separating their emotions from the financial decisions they are making. AI does not have the same problem.

A well-written AI can make decisions based on data and logic, and it will rarely make the wrong choice. That’s unless it has been fed flawed data, of course. But in theory, at least, AI is far superior to humans when it comes to making educated, informed decisions.

The most potent use of AI in investing thus comes down to decision-making. Sure, it can also be used to predict future market trends based on previous ones, and it can even take world affairs and the weather into account. But it will never be flawless, as the stock market is still ruled by human factors to a certain extent.

Is AI Already Widely Used in Investing?

As we enter 2023, AI adoption rates remain slow. We can’t expect it to speed up in the coming years because the cost of adoption is exceptionally high. It requires an investment in new tools, staff training, and a large data set to feed into the AI.

Most investment funds still rely on the lessons their human investors and financial minds have learned either in college or via sheer experience. Blending it with an AI’s input can (and will be) very difficult.

While there are investors who understand the concept of AI and how it is meant to work, they are still a minority, and they will remain one for years to come. However, early adopters can expect to gain a competitive edge, especially if they compile large volumes of useful data.

As it stands now, AI will only be available to those who have the fund to pay for it. Smaller investors will have a harder time adopting it in its earliest stages and can expect to miss out on its benefits for several years to come.

轉貼自： insidebigdata.com

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