Ever since the field of artificial intelligence (AI) emerged in the 1940s, investors have been trying to get computers to predict stock prices.
Until recently, these attempts failed to do so, at least consistently so.
But a recent paper by academics from the University of Florida, titled “Can ChatGPT Forecast Stock Price Movements? Return Predictability and Large Language Models”, claims that with the advent of ChatGPT 3.5, AI can now be applied to predict next-day stock price directions based on the news headlines of the day.
What does this mean for investors?
Are we at the dawn of a new era, where investment decisions will come to be automated? Will markets become even more efficient, further eroding alpha opportunities. Or is it simply another tool in the tool box?
In this [i3] Luncheon co-hosted with UBS Asset Management in Sydney, we will hear from the author or the paper, Alejandro Lopez-Lira, Assistant Professor of Finance, Warrington College of Business, University of Florida, who will be in Sydney to present his findings.
Alejandro Lopez-Lira, Assistant Professor of Finance, Warrington College of Business, University of Florida
Alejandro Lopez-Lira is an Assistant professor of Finance at Warrington College of Business, University of Florida. He holds a PhD in Finance from the Wharton School, University of Pennsylvania.
His research covers topics in Empirical Asset Pricing, Machine Learning and Textual Analysis.Enquire about this event