AI in Investing: Friend or Foe?

Not long ago, artificial intelligence (AI) felt like something out of a sci-fi flick. Fast forward to now, and it’s woven into the DNA of how modern businesses and investment firms operate. AI isn’t coming – it’s already here – and it’s shaking up the investing world in a big way.

While some still worry about the risks, the reality is that AI has unlocked huge efficiency gains, especially for institutions. Big banks and asset managers now rely on AI daily to power through research, spot patterns, and sharpen their strategies.

So how exactly is AI used in investing?

Well, think about the traditional investment process. Analysts spend hours -sometimes days -digging through earnings reports, crunching numbers, and drafting long investment memos. With AI, what used to take hours can now be done in minutes.

Take company earnings reports. AI can summarise them in seconds, flagging why revenue might be up while profits are down -and even point you to the source explaining exactly why. That’s not just convenient, it’s powerful.

And here’s the thing: if the big guys are using it, so should we. Sure, you might not have the firepower of an investment bank, but you don’t need to.

Speed isn’t everything. What really matters is making smarter, better-informed decisions, and that’s where AI shines for retail investors.

Tools like ChatGPT are a great example. Just don’t treat them like a crystal ball. A simple prompt like “Should I buy this stock?” might get you a fast answer -but not a thoughtful one. Always do your own due diligence. Ask better questions. Cross-check key facts. The real value of AI is in how you use it.

How can I get started with AI? (and avoid any mistakes)

The good news? You don’t need a PhD or a fancy subscription to use AI. There are plenty of free tools online -though paid versions generally offer better speed, accuracy, and features.

But the biggest limitation isn’t the tool -it’s the user.

Try this: open ChatGPT and ask, “Tell me about [insert company].” You’ll get a decent overview.

Now ask: “Write a detailed investment report on [company], including strengths, weaknesses, opportunities, threats, and industry positioning.”

Notice the difference?

The second prompt unlocks way more insight. Why? Because vague prompts get vague results. AI reflects the quality of your input -and a well-structured question can deliver research-grade output in a fraction of the time.

Think of it like this: learning how to speak AI is just as important as using it. Spend a bit of time crafting the right prompt and you’ll get a reusable, powerful tool for making consistent, comparable investment decisions.

Can AI replace my Investment Advisor?

Not exactly.

AI today does a lot more than most people think. It can analyse your financial goals, assess your risk tolerance, and even build you a personalised portfolio based on your inputs. It’s fast, scalable, and doesn’t get tired. And when used properly, it can drastically reduce the time and effort it takes to make well-informed investment decisions.

But here’s the catch: AI only knows what you tell it and doesn’t have the intuition to guess!

It doesn’t know you lost your job last week. It doesn’t know you’re saving for a wedding or that your appetite for risk has changed after becoming a parent (unless you mention it). It doesn’t understand fear, or greed, or that sinking feeling when the market dips 10% overnight.

That’s where a real, human financial advisor still shines. A qualified professional won’t just crunch numbers – they’ll ask the right questions, challenge your thinking, and guide you through uncertainty with real-world experience. They’ll take the full picture into account – not just the data, but your life.

So, no – AI isn’t ready to replace human advisers entirely. But it’s also far too powerful to ignore. The smarter approach is to combine both. Let AI handle the heavy lifting: research, screening, data analysis, report writing. Then work with a financial expert to validate, interpret, and personalise that information into a strategy that works for you.

The bottom line? AI is a tool. A powerful one. But like any tool, its value depends on how well you use it. A vague prompt gets a vague answer. A clear, detailed instruction can produce insights that were once only accessible to big institutions with deep pockets.

So, don’t see AI as a replacement -see it as a superpower. One that can help you move faster, see clearer, and invest smarter.