A fictional investment fund that uses controversial generative AI tool ChatGPT has outperformed the UK’s ten most popular funds, raising more questions about how controversial AI technology may be used in the future.
The fund was created by personal finance comparison site finder.com as a “conceptual experiment”.
Created in early March, the fund is, in essence, a collection of 38 stock recommendations selected by ChatGPT, the AI chatbot developed by OpenAI that has shot to notoriety since its launch last November.
In that time, the fund has generated 4.9% in returns, a significantly better performance than the 10 most popular funds on the UK market, which have collectively seen returns dip by -0.8% in that same time period, a difference of 5.7%.
The gap between the ChatGPT fund and the top 10 conventional funds, which includes offerings from the likes of Vanguard, Fidelity and HSBC, was at its widest on April 4th when it stood at 6.6%.
According to finder.com, the fund was created by following a range of investment principles offered by leading funds. Meanwhile, the chatbot’s warning that it “cannot provide investment advice” was overridden by telling the app that it was engaged in a ‘theoretical exercise’.
To date, the top performers in the portfolio are Meta, Microsoft and Intel, which are up by 30%, 20% and 18%, respectively.
Finder.com also surveyed consumers for their views on the use of AI in the investment world. Almost one in five (19%) said they would consider getting financial advice from ChatGPT, while another 8% said they are already doing so.
Unsurprisingly, these figures were even higher when applied to younger generations, with 28% of millennials and 23% of gen z stating that they would take advice from the chatbot.
Yet, despite the performance of the fictional fund, the majority of investors would still steer clear of ChatGPT when it comes to their portfolios.
More than a third (35%) said they would not use ChatGPT, while a larger number (38%) said they had not heard of it.
According to finder.com founder Jon Ostler, the big question is whether to use ChatGPT for investment research. “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,” he said.
“Yet a white paper we did in 2021 found that half of British investors use social media to get investing advice, and a fifth only use social media. Would you rather get your advice from an unqualified tik tok star or AI that is capable of processing millions of data points from around the web and giving tailored advice?” he added.
While noting that ideally, investors would use primary sources or trusted advisors, Ostler added that AI seems to be something that will eventually “disrupt and revolutionise financial industries” and that “fund managers may be starting to look nervously over their shoulders”.
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