Artificial Intelligence Will Not Change How Stock And Bond Markets Set Prices
· Business · Fortune, Wall Street Journal
Artificial intelligence may transform industries and everyday tasks, but it will not alter how stock and bond markets function. Financial expert David Booth argues that public markets operate as massive information processing machines where buyers and sellers determine fair prices through millions of daily transactions. Historical data shows that US stocks have returned about 10% annually on average over the last century, and professional stock pickers rarely beat the market over time. Believing an AI agent can consistently outperform the market requires assuming it can predict uncertain future returns and systematically beat all competitors. The report does not specify whether future AI models could improve information gathering for individual investors.
Why it matters
Individual investors and financial planners are reminded that trying to beat efficient public markets using AI or stock-picking strategies remains unreliable over the long term.
Read the original report — Fortune
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