AI vs the Stock Market: How Did Value Stocks, Gold and PayPal Perform in April?
Artificial intelligence (AI) is becoming more and more ingrained in our daily lives, helping us with everything from solving customer service issues to diagnosing medical conditions to picking stocks to buy.
It’s that last one that is the focus of this article. Given AI’s ability to analyze massive amounts of data in a very short amount of time – a feature that requires enormous energy use – the technology is a natural fit for investors, traders, asset management firms and the like.
As just one example, most banks and brokers now offer robo-adviser accounts, which use AI to build and manage investment portfolios at a much lower cost than those maintained by actual people.
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And for those do-it-yourselfers (DIYers), there’s a laundry list of stock-picking platforms such as Danelfin that use AI to spit out lists of the top stocks matching their specific criteria.
I decided to test AI’s predictive capabilities, and back on March 31, I asked Google’s Gemini AI chatbot where I should invest in April. I also asked for a list of the best stocks to buy for the month.
Here’s what it had to say and how its predictions matched actual market movement. All returns are through the April 29 close.
Where to invest
When I asked Gemini where to invest in April, it offered me a broad list of “potential investment areas for April 2025.”
Right off the bat, it listed “undervalued stocks,” highlighting Nike (NKE) and Alphabet (GOOGL) as “individual stocks currently considered undervalued by analysts.”
April was a volatile month for the equities market, and value stocks as a group, as measured by the S&P 500 Value Index, fell nearly 4%. Growth stocks, on the other hand, generated a 2% return in April, per the S&P 500 Growth Index.
As for NKE, it shed 9.4%. GOOGL stock gained 3.6%.
The chatbot also highlighted insurance stocks as a potential investment area, given they were “showing relative strength” and “reaching new highs” heading into April.
It recommended the iShares U.S. Insurance ETF (IAK) as one of the best ETFs to buy to gain broad exposure to the industry. IAK is poised to finish the month of April down 4%.
Gemini also recommended gold as a potential opportunity for investors. “Gold has been a strong performer in early 2025,” the chatbot said, adding that it is “often seen as a safe-haven asset during times of uncertainty.”
The precious metal continued its uptrend in April, gaining more than 5% and hitting a record high north of the $3,500 per troy ounce price point on April 22.
Best stocks to buy
When I asked Gemini on March 31 what the best stocks to buy in April would be, it offered up several suggestions.
To start, it named pharmacy retail chain CVS Health (CVS) and tobacco giant Philip Morris International (PM) as stocks that had outperformed for the year to date through March 31 and could continue to do so through April.
CVS shares slumped 4%, but PM stock rose 7.3%.
Gemini also called out automaker General Motors (GM) and fintech firm PayPal Holdings (PYPL) as possible options for those seeking out top value plays.
Looking at their actual performance for April, GM was flat, while PYPL gained 1.6%.
For what it’s worth, these were the best-performing S&P 500 stocks in April:
|
Stock |
Return |
|
Palantir Technologies (PLTR) |
35.2% |
|
GE Vernova (GE) |
22.5% |
|
CrowdStrike Holdings (CRWD) |
20.7% |
|
Netflix (NFLX) |
20.5% |
|
ServiceNow (NOW) |
18.2% |
|
Cadence Design Systems (CDNS) |
17.7% |
|
Discover Financial Services (DFS) |
16.8% |
|
Amphenol (APH) |
15.2% |
|
NRG Energy (NRG) |
15.1% |
|
Quanta Services (PWR) |
15.0% |
The bottom line on AI vs the stock market
I did appreciate that Gemini noted its recommendations were “for informational purposes only and should not be considered financial advice.”
It also reminded me of the risks involved with investing in the stock market, including losing my money, and advised me to conduct my own research and consider speaking with a financial adviser.
To be sure, I would never blindly invest in anything an AI chatbot recommended – and neither should you. Still, it is an interesting exercise to see how picks made by AI would perform throughout the month.
So much so that I’m doing it again for May. Check back next month to see how AI’s stock picks fared. Here’s a hint: We’re watching growth stocks, Albemarle (ALB) and Target (TGT).