AI-powered Financial Advice: How it works?

Here is the detailed information on Artificial Intelligence or AI-powered financial advice

Many people overlooked BloombergGPT, a new generative AI model released by Bloomberg, among the flood of new generative AI models provided by tech companies. Using their massive datasets, the major provider of financial data constructed a fifty-billion parameter Large Language Model (LLM). GPT3 had 175 billion attributes in contrast, but Bloomberg's data was solely financial. Combine this powerful finance-focused core model with ChatGPT's outstanding conversational skills, and we could have answers to almost every financial query. So, can Generative AI-powered financial advice, can you trust it, and may it eventually replace human financial advisors?

Today, if you go to ChatGPT Plus and ask whether you should purchase Apple stock, it flatly rejects you and advises you to see an expert. If I broaden the topic and ask how the stock will move, it again declines. This is due to two factors: One, ChatGPT has placed barriers around itself to avoid answering these questions for ethical and legal liability concerns, and two, it is impossible for ChatGPT to do so since it is not connected to the World Wide Web's treasure trove. After 2021, OpenAI stopped supplying data to ChatGPT in order to regulate it. However, a specialized product such as BloombergGPT and every other one that will be released may not have these constraints. Having said that, I do not believe Generative AI, in its current state, can provide credible financial advice.

For many years, Artificial intelligence has been utilized extensively in the financial services business, possibly more than any other, to forecast pricing, market moves, and so on, and has been providing 'financial advice' to experts. We've been performing algorithmic trading, in which AI-based computers trade on their own without any human intervention. However, there are significant issues with the latest phase of AI, known as Generative AI. It is constructed differently from pure machine learning-based corporate AI, like huge auto-complete language engines. Generative AI is optimized for plausibility rather than truth; it frequently hallucinates and makes stuff up as it goes. This is not conducive to providing competent financial advice. However, if models improve and specialized models such as Bloomberg's emerge, we can anticipate I have long believed that while AI will not take our jobs, humans employing AI may. As a result, a financial adviser who employs these sophisticated technologies may be able to provide you with greater advice than someone who does not. She might have AI pull out the relevant financial facts, present them in a clear manner, provide insights she might overlook, and propose several guidance options. The adviser could thus give the finest recommendations much faster thanks to her expertise, intuition, and customer understanding. This is why Morgan Stanley is experimenting with GPT4 on a large basis. It has identified information in over a hundred thousand internal papers about which it's over a hundred thousand financial advisers may have questions, such as investment suggestions, general business queries, and procedure concerns. GPT4 is then fine-tuned to assist answer this question.