Personal Finance and AI: Can You Trust ChatGPT’s Investment Advice?
Many small investors are now using AI tools like ChatGPT to make money decisions, even though experts warn about the risks. But can simple AI models really give reliable investment advice?
People often ask ChatGPT questions like, “Should I buy this stock?” and get quick answers. Around the world, many investors are allowing AI chatbots to guide their investments — even though regulators say these tools cannot replace licensed financial advisers.
Rules for AI-based investing are still being developed. Yet, a report by trading platform eToro found that nearly one in five small investors already use AI tools to help make or change their investment plans. The survey included 11,000 investors from 13 countries, though it didn’t specify which AI tools they used.
Experts say the main question is how people use AI — as a tool to help with research or as a direct adviser. Giving investment advice is a regulated service in the EU under the MiFID rules, and no public AI tool is officially allowed to do this, according to the European Securities and Markets Authority (ESMA).
Even so, many investors use ChatGPT-like tools to save time and reduce the cost of hiring professionals. Some results are impressive.
In 2023, comparison site Finder created an investment fund mostly managed by ChatGPT. After two and a half years, its 38-stock portfolio gained nearly 55%, beating the UK’s top 10 funds by over 18%.
But experts warn that unpredictable market changes could quickly hurt such AI-managed funds. Chatbots like ChatGPT or Gemini might not handle sudden market swings well, which could lead to losses.
OpenAI did not respond to Euronews’ request for comment, so journalists asked ChatGPT directly.
ChatGPT replied, “OpenAI hasn’t said people should not use ChatGPT for investing, but it should only be used as a tool to support — not replace — professional advice. Sometimes it can sound confident but still be wrong.”
Under EU rules, companies can use AI tools to study a client’s knowledge, experience, financial situation, and goals when giving investment advice or managing portfolios. However, ESMA says firms must ensure transparency, human oversight, and proper control when using AI.
AI’s Role in Finance
AI is changing the financial world. It now helps with customer service, fraud detection, portfolio management, and personalised advice.
Behind the scenes, powerful AI systems study huge amounts of data — market trends, past prices, and even news — to predict movements and find investment chances.
A 2025 study in Nature compared ChatGPT with other financial AI tools. It found ChatGPT is good at understanding messy data, like reports or investor questions, which helps in financial planning and risk analysis. But the study also warned that if the data fed into these systems is wrong or biased, AI can give misleading answers — a problem known as “hallucination.”
Investment platform BridgeWise offers AI-powered research, analysis, and investment advice on more than 50,000 assets. The company is a good example of why tools like ChatGPT can be risky if not used properly.
Gaby Diamant, BridgeWise’s co-founder and CEO, warned that asking ChatGPT about lesser-known companies can lead to false answers. “If you ask about a company that’s not well-known, the chat might make up information to please you,” he said. Diamant advised people not to use vague prompts like “Should I invest in X?” because such questions can lead to very misleading results.
BridgeWise focuses on qualified research and following financial regulations. It provides AI-based insights on specific assets such as stocks, ETFs, and funds. The company works with stock exchanges in Switzerland, Israel, Japan, and Brazil.
The firm’s advanced algorithm helps understand market trends. “We offer tools to help people make decisions — we don’t make the decisions for them,” said Diamant.
When asked if AI could replace financial advisors, Diamant’s answer was clear: “Never.” He believes human judgment is still vital to understand clients and handle the complex world of finance — something AI cannot do yet.
Still, he sees AI as a helpful tool. “Since founding BridgeWise in 2019, our goal has been to make capital markets open to everyone,” he said.
The future of AI in finance
It’s clear that AI tools like ChatGPT still need to improve before they can guide everyday investors safely through financial markets.
Kieran Garvey, a policy manager at the Cambridge Centre for Alternative Finance, said that while AI is very advanced in some parts of finance, it is still “far from reliable” when it comes to giving financial advice.
To overcome these limits, Garvey mentioned a growing trend called agentic AI. This type of AI can act with more independence — planning and completing tasks on its own using different tools.
“As humans, we can give them a task,” he explained. “The AI then figures out what to do, plans the steps, and uses the tools needed to finish it.”
In the future, AI agents might even make payments for customers — such as booking trips or shopping automatically.
Even with current limits, automated financial advisors (or “robo-advisors”) are becoming more common. Experts expect this market to grow fast over the next five years.
According to research firm The Business Research Company, the robo-advisory market is expected to reach over $471 billion (€405 billion) by 2029, up from nearly $62 billion (€53 billion) in 2024. This figure includes all revenue earned from selling goods and services in the industry.
Also Read:
How European SMEs Are Thriving Amid Market Changes
Apple Reaches $4 Trillion Market Value After iPhone 17 Success
Health & Wellness Businesses Booming Across Europe