By Michael Hooper
Investors are facing a new future with AI in stock research. Google's Bard will predict future stock prices.
If you ask Bard what will be a stock's price at year end, it spits out a short report with a prediction, but be careful, some of the information may be incorrect.
Microsoft's ChatGPT uses a more cautious approach when asked about the direction of a stock or index.
I asked what will be the price of Alphabet stock (GOOG) by year end? Bard answered, saying, "The price of Alphabet stock by year end is difficult to predict with certainty. However, based on its current price of $124.66 and the company's financial performance, it is possible the stock will reach $130-$140 by year end 2023. Alphabet is a well-established company with a strong record of profitability. The company's revenue and earnings have been growing steadily in recent years, and it is expected to continue to grow in the future. Alphabet also has a strong dividend yield, which makes it an attractive investment for income-oriented investors." What? That’s not right. Google does not pay a dividend. This error is startling because Google owns Bard so the company can’t even get its own information correct on its stock.
I also asked what the price of Union Pacific (UNP) stock will be by year end. Bard answered incorrectly, saying it had a current price of $147.65, which is totally wrong. The price is around $200 per share. Bard got the dividend on the stock correct, but said it faces competition from BNSF Railway (true) and CSX (less so).
I was modestly impressed with Bard's answer to my question on what will be the price of Hershey (HSY) by year end. Bard predicted the stock could reach $260-$270 by year end. The stock had already reached that price earlier this year. The stock is currently around $254 per share. Argus Research, written by a real person (Taylor Conrad), has a price target of $315 per share.
Performance of Spider S&P 500 Etf (SPY) so far this year
I also was modestly impressed with Bard's prediction of Spider S&P 500 Etf (SPY). "The price of the SPDR S&P 500 ETF Trust (SPY) by year end is difficult to predict with certainty. However, based on its current price of $426.62 and the company's financial performance, it is possible that the ETF could reach $430-$440 by the end of 2023. SPY is a well-established ETF with a strong track record of profitability. The ETF's assets under management and trading volume have been growing steadily in recent years, and it is expected to continue to grow in the future. SPY also has a low expense ratio, which makes it an attractive investment for cost-conscious investors." All that is fairly solid.
ChatGPT
ChatGPT was a little more cautious about stock price outlooks, not offering any price prediction, and actually recommending that you talk to a financial advisor about possible stock purchases. I thought this was wise given that it has not figured out how to present a thorough analysis yet.
I think Google rushed out Bard in order to get it in the marketplace to compete against ChatGPT, but in the area of stocks, Bard needs improvement.
I plan to keep an open mind about using AI for stock research, but right now both Bard and ChatGPT are poorly faltering behind real people and real analysts. Indeed, you are better off reading stories, pro and con about a stock on Seeking Alpha than depending solely on AI for your research.
I predict Google and Microsoft will work to make these AI tools more accurate and thorough in the field of stock research in the future. They need software to prevent errors on basic stuff like stock prices, dividend yield, plus they need more in-depth analysis, not just a formula viewpoint. Even better would be to bring in both pro and con positions on stocks and Etfs, commodities and crypto. I see huge opportunities in the financial space with AI, this field is going to blow wide open. The winners will have unmatched got-to-have-it capabilities.
Author Michael Hooper owns shares of Hershey, Google, Microsoft, Union Pacific and SPY.
No comments:
Post a Comment