A survey report from Klynveld Peat Marwick Goerdeler (KPMG) gives data that 65 percent of the financial reporting leaders are utilizing AI functions to help with their reporting workflows and 48 percent have piloted some form of Gen AI solution in their work modules. AI has been used by professionals to build effective financial strategies. AI provides them the solution of quick analysis in a few minutes against the time-consuming manual analysis of data and interpretation.
With AI-driven investments review at the forefront, it’s easier to understand the current trends and market fluctuation to predict the future financial landscape and build strategy accordingly. Therefore, it becomes pivotal for those who are planning on their investment strategies to know how AI-driven investment strategies & advisory reshaping the age-old financial planning process.
AI can now facilitate in:
Provides a Quick Research and Analysis
The finance market offers a wide range of opportunities for investors. However, it can be a hurdle to know what to invest in with an unpredictable market and a changing economy. One can’t try to analyze the changing market trends, predict the future and draw a solution. All of this must happen before the next cycle of change appears in the market. This task can be time-consuming and sometimes may result in error. But with AI such tasks can be performed within a fraction of hours. With the help of AI one can analyze vast amounts of data in real time. This can outbound the inefficient traditional lagging manual process. With more accurate data and statistics provided, the efficiency of decision-making improves.
One of the best examples to refer here is the financial advisory firm, Fiscal Group. The firm’s traditional compliance editing process was time-consuming and led to many errors, resulting in delayed results. This caused the company to face non-compliance issues, resulting in the payment of hefty penalties. But FiscalGuard updated its audit to the AI system. With AI’s advanced algorithm, the company was able to identify- unusual patterns and scrutiny in the huge amount of data. This saved the company’s time spent on auditing by 70 percent. With AI’s predictive features, the company was able to identify the possible non-compliance action. This helped the company to avoid the penalties related to non-compliance by 80 percent.
Identifying potential Risk
The manual research can help one to understand the current market, but predicting the future can become difficult when the finance market is extremely volatile. But AI with its algorithm analytics not only can study the current trends and fluctuations but also can predict the future of the market. The AI investment advice can help one to understand the risk associated with the investment plan and make a better decision for their investment.
GlobalTrust Insurance faced financial risk due to inefficiency in their traditional risk assessment models, which always delivered unreliable reports. The final latched onto an AI-based risk assessment model which provided a solution for the complex datasets. With AI technology the company was able to get a 30 percent improvement in predicted risk assessment based on the existing data and current trends.
Designs Personalized Investment advice
It would be difficult for one to make a decision when they are offered a platter of different investment plans. One can use AI-driven investment management to make a personal investment plan based on expenditure patterns, money to be invested, and the purpose of investment and rate of returns. AI integrates personal data with market trends and future predictions, to deliver tailored investments according to one’s needs. This attribute has been used by finance companies from the time AI was introduced.
Prosperity Partners faced failure in making tailored investment plans on individual attributes for their customers. The company with its traditional advisory systems delivered aggregate financial investment plans, by ignoring individual differences of their clients. This led to a higher retention rate from clients. The company utilized AI to analyze market trends, individual client data and economic indicators based on clients' regional data, to prepare a tailored investment plan for their clients. This resulted in a 40 percent increase in the client satisfaction rate and an increase in the number of clients.
Making Portfolio Optimization
One can use AI-driven investment groups to optimize their investment portfolio. The AI technology will assist one in understanding the current marketing trends by presenting the existing data, market situation and economic trends. With different investment plans being available, AI technology will help in analyzing the investment choices and facilitate asset allocation based on individual preferences. By creating an investment mix for the individual, AI can help one to minimize the risk factor in their investment.
In EquityPlus Investment, the traditional portfolio management tools delivered inefficient data often leading to missed opportunities for the clients. With their new AI-powered portfolio management system, the real-time market analysis of the technology helped them to build strategic portfolios for their customers. The AI tool incorporated global economic trends, geopolitical conditions and corporate earnings reports to build its data. This helped them in increasing a 35 percent portfolio performance for their clients.
Improved Backtesting
Traditional backtesting can only help investors understand how a particular strategy worked on historical data, often blurring the applicability of the strategy in the present context. However, with the assistance of AI, it's easier for investors to know how a particular strategy has worked on previous data and can change over a period. This can help the investors to plan for a strategy that will be effective in the long run.
Ultimately, the investment market has changed over some time. The constantly changing market conditions, the increased option of investment opportunity and lesser education on financial planning can often lead to confusion of what to do with investment. But with AI-driven investment solutions, one can get easy access to financial planning. With technologies like GPT-F and Bloomberg GPT, one can get assistance in wealth management, personalized recommendation, investor sentiment analysis, risk evaluation, fraud detection, financial research, analysis and planning. AI-driven investment funds are the new possibility in finance, which is opted by everyone. With appropriate tools, a strategic investment plan can be built.
