- Magnifi uses ChatGPT and computer programs to provide personalized, data-driven investment advice.
- “It’s a copilot for the self-directed investor,” said Vinay Nair, founder of Magnifi. “Magnifi is trying to democratize intelligence in a personalized way.”
- It also performs like a brokerage where you can directly trade stocks and ETFs.
Applying artificial intelligence to the world of finance is all the rage, and a new investing platform just took it to another level.
Magnifi is one of the first investing platforms that uses ChatGPT and computer programs to provide personalized, data-driven investment advice. Not only does It answer investor questions in human-like conversations, it also monitors individual portfolios, guiding users through market-moving events like rate hikes and earnings reports. And there’s a bonus — it performs like a brokerage where you can directly trade stocks and ETFs.
“It’s a copilot for the self-directed investor,” Vinay Nair, founder of Magnifi, said in an interview. “Today brokerages have democratized access to trading, to markets, but they lack intelligence and they lack personalization for the user. Magnifi is trying to democratize intelligence in a personalized way.”
As AI continues to make breakthroughs, Wall Street gets increasingly curious how the technology could disrupt the asset management business. A recent preliminary study showed that ChatGPT, the hottest AI tool in the world, could have the potential to improve investment decision making.
To see how Magnifi performs and how it competes with professional advisers, I asked it a few different questions.
First, I posed the question “what stocks would Warren Buffett buy?” It came back with an explanation of his value investing principle along with the “Oracle of Omaha’s” biggest holdings, Bank of America, Apple and Coca-Cola.
Then the system was able to compare these three stocks in terms of return and volatility over the past year.
Secondly, I wanted to see how Magnifi would help me navigate the earnings season. I asked it what would happen to a hypothetical Amazon holding when the e-commerce retailer reports earnings.
The robot showed me the earnings estimates from Wall Street analysts as well as Amazon’s track record in the last few quarters.
Finally, I asked how rate hikes are affecting my imaginary portfolio, with iShares 20 Plus Year Treasury Bond ETF as one of my holdings. It told me that rising rates can have a negative impact on bond funds such as TLT, with examples of historical performance in similar environments.
Nair said many investors tend to ask questions as generic as “how do I get started?” But the more users engage, the more inputs the system can collect and the more personalized answers it can provide, the founder said.
The platform charges a $14 flat fee per month, and Nair said his company doesn’t make money from trading, or payment for order flows.
“It’s a very customer aligned model, which gives us no incentives to get them to trade too much, directly or indirectly,” Nair said.
Source: Finance - cnbc.com
