Forty-one per cent of 10,000 retail investors across 13 countries surveyed by eToro ‘firmly’ opposed using artificial intelligence (AI) tools, such as ChatGPT, to help select and alter investment portfolios. On the other hand, while 35% of respondents are open to the idea, only 11% of them have started using AI to manage their portfolios.

Older Investors Reject AI-Led Investment

eToro disclosed the details in its latest Retail Investor Beat report released yesterday (Thursday). This is even as the introduction of ChatGPT by the non-profit research firm, OpenAI, in November last year has sparked global interest in conversational AI. Currently, the tool boasts over 100 million users and billions in monthly website visits.

However, eToro in its survey found that older investors appear to be against adopting AI for investment management. According to the study conducted by the Israel-based social trading and investment firm, more than half (55%) of retail investors over 55 years old dislike the practice, with a further 39% of 45-54-year-olds standing against it.

Furthermore, just over a quarter (29%) of 18-34-year-olds dislike the practice, followed by 30% of retail investors between the ages of 35 and 44. The new findings do not seem to agree with an earlier study by eToro that found that the number of investors aged 55 years and more investing in AI stocks has grown significantly faster than any other age group.

Additionally, observations from eToro’s latest survey go in a different direction from recent research that found that about 73% of UK investors trust ChatGPT to provide reliable financial advice in the future.

Is AI the Future of Investing?

Meanwhile, eToro in its report noted that the main reasons most retail investors want to use AI to manage their investments are because they believe that AI is the future of investing (43%) and it can save time on research (42%). Moreover, a significant number of investors think AI can make better decisions (34%) and can pick better investments than a fund manager (30%).

“Consumer AI tools are seeing the fastest growth rates of any technology in history, and it’s no surprise that early-adopters are starting to use them for investing,” Ben Laidler, the Global Markets Strategist at eToro, stated in his comment on the numbers. “These older, wealthier, and more experienced investors are pioneering the investment use cases, from background research to stock-picking, that others seem increasingly likely to follow.”

Laidler added: “But the technology is far from faultless, with the early example of an AI-powered ETF significantly underperforming.”

eToro’s survey polled respondents from several countries, including the United States, the United Kingdom, Germany, France, and Australia. In the United States, Gary Gensler, the Chair of the Securities and Exchange Commission (SEC), has raised concerns that AI may heighten financial fragility in the future.

Earlier this week, the SEC expressed concern that AI could be used to the detriment of investors. The securities watchdog, therefore, plans to introduce rules requiring broker-dealers and investment advisers to address the conflicts of interest that may arise from their use of predictive data analytics and other similar technologies, Finance Magnates reported.