41% of 10,000 Retail Investors ‘Firmly’ Reject ChatGPT for Investment

41% of 10,000 Retail Investors ‘Firmly’ Reject ChatGPT for Investment

Time Stamp: July 28, 2023 1:13 PM
Source Node: 2789992

Forty-one
per cent of 10,000 retail investors across 13 countries surveyed by eToro
‘firmly’ opposed using artificial intelligence (AI) tools such as ChatGPT to
help pick and alter investment portfolios. On the other hand, while 35% of
the respondents are open to the idea, only 11% of them have started using AI to
manage their portfolios.

eToro
disclosed the details in its latest Retail Investor Beat report released yesterday (Thursday). This is even as the introduction of ChatGPT by non-profit research firm,
OpenAI, in November last year has sparked global interest in conversational AI. The tool currently boasts of over 100 million users and billions in
monthly visits.

However, eToro in its survey found that older investors appear to be against
adopting AI for investment management. According to the study conducted by the
Israel-based social trading and investment firm, more than half (55%) of retail
investors over 55
years old dislike the practice, with a further 39% of 45-54 years old against
it.

Furthermore,
a little over a quarter (29%) of 18-34 years old dislike the practice, followed
by 30% of 35-44 years old retail investors. The new findings
seem contrary to an earlier study by eToro that found that the number of
investors aged 55 and over investing in AI stocks has grown significantly
faster than any other age group.

Additionally,
observations from eToro’s latest survey go in a different direction
from a recent research that found that about 73% of UK
investors trust ChatGPT to provide reliable financial advice in the future.

Is AI the
Future of Investing?

Meanwhile, eToro in its report noted that the top reasons most retail
investors want to use AI to manage their investments are because they believe
that AI is the future of investing (43%) and it can save time on research
(42%). Moreover, a
significant number of investors believe that AI can make better decisions (34%)
and can pick better investments than a fund manager (30%).

“Consumer
AI tools are seeing the fastest growth rates of any technology in history, and
it’s no surprise that early-adopters are starting to use them for investing,”
Ben Laidler, Global Markets Strategist at eToro, stated in his
comment on the numbers. “These
older, wealthier, and more experienced investors are pioneering the investment
use cases, from background research to stock-picking, that others seem
increasingly likely to follow.”

Laidler
added: “But the technology is far from faultless, with the early example of an
AI-powered ETF significantly underperforming.”

eToro’s
survey polled respondents from several countries, including the United Kingdom,
the United States, Germany, France and Australia. In the United States, Gary
Gensler, the Chair of the Securities and Exchange Commission (SEC) has
raised concerns that AI may heighten financial fragility in the future.

Earlier this week, the SEC also expressed concern that AI
could be used to the detriment of investors. The securities watchdog,
therefore, plans to
introduce rules requiring broker-dealers and investment advisers to address
conflicts of interest that may arise from their use of predictive data analytics and
other
similar technologies, Finance Magnates reported.

Forty-one
per cent of 10,000 retail investors across 13 countries surveyed by eToro
‘firmly’ opposed using artificial intelligence (AI) tools such as ChatGPT to
help pick and alter investment portfolios. On the other hand, while 35% of
the respondents are open to the idea, only 11% of them have started using AI to
manage their portfolios.

eToro
disclosed the details in its latest Retail Investor Beat report released yesterday (Thursday). This is even as the introduction of ChatGPT by non-profit research firm,
OpenAI, in November last year has sparked global interest in conversational AI. The tool currently boasts of over 100 million users and billions in
monthly visits.

However, eToro in its survey found that older investors appear to be against
adopting AI for investment management. According to the study conducted by the
Israel-based social trading and investment firm, more than half (55%) of retail
investors over 55
years old dislike the practice, with a further 39% of 45-54 years old against
it.

Furthermore,
a little over a quarter (29%) of 18-34 years old dislike the practice, followed
by 30% of 35-44 years old retail investors. The new findings
seem contrary to an earlier study by eToro that found that the number of
investors aged 55 and over investing in AI stocks has grown significantly
faster than any other age group.

Additionally,
observations from eToro’s latest survey go in a different direction
from a recent research that found that about 73% of UK
investors trust ChatGPT to provide reliable financial advice in the future.

Is AI the
Future of Investing?

Meanwhile, eToro in its report noted that the top reasons most retail
investors want to use AI to manage their investments are because they believe
that AI is the future of investing (43%) and it can save time on research
(42%). Moreover, a
significant number of investors believe that AI can make better decisions (34%)
and can pick better investments than a fund manager (30%).

“Consumer
AI tools are seeing the fastest growth rates of any technology in history, and
it’s no surprise that early-adopters are starting to use them for investing,”
Ben Laidler, Global Markets Strategist at eToro, stated in his
comment on the numbers. “These
older, wealthier, and more experienced investors are pioneering the investment
use cases, from background research to stock-picking, that others seem
increasingly likely to follow.”

Laidler
added: “But the technology is far from faultless, with the early example of an
AI-powered ETF significantly underperforming.”

eToro’s
survey polled respondents from several countries, including the United Kingdom,
the United States, Germany, France and Australia. In the United States, Gary
Gensler, the Chair of the Securities and Exchange Commission (SEC) has
raised concerns that AI may heighten financial fragility in the future.

Earlier this week, the SEC also expressed concern that AI
could be used to the detriment of investors. The securities watchdog,
therefore, plans to
introduce rules requiring broker-dealers and investment advisers to address
conflicts of interest that may arise from their use of predictive data analytics and
other
similar technologies, Finance Magnates reported.

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