2023 will see the rise of AI, and programs like Bard and ChatGPT will provide answers to everything from weather information to writing college essays. We all know that AI is based on machine learning, but how reliable is the advice they give? We wanted to know if these programs were reliable, so we gave ChatGPT a budget of $10,000 to invest in stocks and $10,000 to invest in cryptocurrencies, and then followed the advice they provided.
Before following this advice, please note that ChatGPT states that the information provided is not financial advice and that you are always advised to consult your financial advisor. ChatGPT also recommends doing your own research to make a more informed decision about which stocks are worth investing in.
The program offers further advice on cryptocurrencies, highlighting the volatility of cryptocurrencies and the importance of considering your financial situation when making investment decisions. We also recommend that you regularly review your portfolio based on market conditions and investment performance.
breakdown
It took a bit of training, but eventually ChatGPT was able to accurately suggest a budget to invest in each stock/coin. The breakdown is as follows.
stock | percentage | Total investment |
Apple |
Ten% |
$1000 |
Amazon.com Inc. |
Ten% |
$1000 |
microsoft |
9% |
$900 |
Alphabet Inc. |
9% |
$900 |
NVIDIA Corporation |
8% |
$800 |
Tesla |
7% |
$700 |
Next Era Energy, Inc. |
7% |
$700 |
Amgen |
Four% |
$400 |
Johnson & Johnson |
Four% |
$400 |
moderna |
Four% |
$400 |
Pfizer Japan Inc |
Four% |
$400 |
Gilead Sciences, Inc. |
3% |
$300 |
PayPal Holdings Inc. |
3% |
$300 |
general motors company |
3% |
$300 |
NIO Co., Ltd. |
3% |
$300 |
First Solar Co., Ltd. |
2% |
$200 |
Enphase Energy Co., Ltd. |
2% |
$200 |
Shopify Inc. |
2% |
$200 |
Vestas Wind Systems A/S |
2% |
$200 |
MercadoLibre Inc. |
1% |
$100 |
Johnson Controls International plc |
1% |
$100 |
Square Co., Ltd. |
1% |
$100 |
Rivian |
1% |
$100 |
coin | percentage | Total investment |
Bitcoin |
20% |
$2000 |
ethereum |
20% |
$2000 |
binance coin |
Ten% |
$1000 |
litecoin |
Ten% |
$1000 |
Solana |
Ten% |
$1000 |
polka dot |
Ten% |
$1000 |
ripple |
Ten% |
$1000 |
Cardano |
Ten% |
$1000 |
The proposed stock is highly anticipated. Investments in stable stocks are high, and investments in volatile stocks are low. Investing in cryptocurrencies is a little more interesting, but given a short list of 8 to invest in, out of the 1000+ coins currently on the market.
experiment
first week
The experiment began on shaky footsteps, with stocks closing with a gain of $159 and cryptocurrencies losing $64 after the first day. He lost 5 of the 8 cryptocurrencies he invested in, with Binance his worst performing coin, with a $956 investment he lost $44.
The stock rose throughout the week, but fell at the end (down $25 from the previous day) to a final weekly total of $10,220. This is his $220 increase from his initial investment and is off to a good start as an experiment.
Our crypto investment didn’t go so well the first week. There were only 3. It takes days to get profit from your first $10,000 investment. Day 4 was the worst of the entire experiment, with a final total of $9,741 for him. Only two of the coins invested made a profit that day, with Ethereum losing $114 from its initial investment. Our week ended slightly positive with a final total of $10,021 for him, an increase of $21 from his initial investment.
2nd week
In the second week The total amount reached $10,643 by the end of the second day. This is $423 more than the total at the end of Week 1. However, this high didn’t last long and the price ended the rest of the week lower, ending at $10,492. That’s $272 more than the first week’s closing price, but $151 less than the day two total.
After a shaky start, cryptocurrency investments far outstripped equities in the second week, reaching a new all-time high of $11,118 on the fourth day. It then declined on his fifth day of the final day, with his closing value for the week at $10,987, an increase of $967 from the first week.
3rd week
The beginning of the third week saw a further decline in equity investment. Of the 23 investments he made, 9 fell on his second day and he on his third. The second half of the week performed better, increasing to a total of $10,559 by the final day.
Our cryptocurrency investments followed suit, with a decline at the beginning of the week and an increase towards the end. The final value he dropped to $10,609 on day four, but increased dramatically to $10,974 by the end of day five. The week ended at $11,402, up $415 from the second week.
final week
The final week of our stock investment was disappointing as the overall value declined slightly to a final value of $10,587. This represents an overall increase of $587 from the initial investment, giving him an overall ROI of 6%.
On the first day of the final week, our crypto investments increased by $314 to a total of $11,719. This is the highest end-of-day total he has reached in the experiment. However, while this was the highest score, it declined for the rest of the week, ending with a final total of $11,359 and an ROI of 14%.
overall performance
stock
Ultimately, we were able to make a profit from our equity investments, but there were 10 investments that lost money on their initial investment, which was almost 45% of their investment. The worst performing stock was Pfizer. This decreased from his third week, resulting in a -10% ROI. This was after the company announced that: discontinue development Concerns about the safety of rotigliprone, a candidate for type 2 diabetes and obesity.
Rivian proved to be the best performing stock with an ROI of 88%, rising from an initial price of $14.03 per share to $25.51 in one month.this is after company announced Q2 2023 was the best financial quarter in the company’s history.
Cryptocurrency
On the other hand, they were much luckier in investing in cryptocurrencies, with only one investment returning a loss, accounting for 13% of the initial investment. This was Ripple (XRP). There are several reasons for this. One is that the trading volume of XRP is 90% less.
The coin with the highest ROI is Solana (SOL) with an ROI of 39% ($389 increase). SOL is considered to be a relatively stable coin with strong community support, making it a good coin to invest in.
Hit or miss?
Bitcoin is the largest cryptocurrency, so it may have been suggested as one of the biggest investments. It was actually the best cryptocurrency to invest in as the price rose from $26,000 to $30,000. this is, A new, safer cryptocurrency exchange Launched with investment from Invesco and WisdomTree.
There is one stock that I believe may have been left out of ChatGPT’s suggestions. Meta, the company that owns Facebook and Instagram. They recently released a new app called Threads, a Twitter competitor, as part of Instagram. It was released at the perfect time after receiving the news. Twitter has its limits The number of tweets a user can view.
This is not one of the stocks ChatGPT suggested investing in, so I wanted to know what would have happened if ChatGPT had suggested investing in META stocks. Using historical data from the last month, he calculated that if he invested $1,000, he would have earned $1,100 by the end of the experiment. That’s more than the $1,000 invested in Amazon and Apple stock.
methodology
We started by asking ChatGPT about stock market opportunities. Initially, it provided general answers about what industries to invest in and why. We asked them to recommend specific companies in each of these industries. He then sent back a list of all the suggested stocks and asked them to weight the $10,000 investment.
It turned out that one of the proposed stocks, Waymo, was not a publicly traded company, so I had to go back to ChatGPT and ask them to remove this stock and add a new one. It has been replaced by Johnson Controls International plc.
The process of getting answers about which cryptocurrencies to invest in was much easier. ChatGPT provided the initial list of coins, asked how much to invest in each, and provided general investment strategies for cryptocurrencies. You should get 40-50% for Bitcoin and Ethereum combined and 10-20% for each of the remaining coins. We decided to invest 20% in Bitcoin, 20% in Ethereum and 10% in the rest of the coins.