Many clever strategies have been revealed for using ChatGPT to make extra money. You can prompt the chatbot to teach you about making money and to help with anything involved in this journey. You can also use ChatGPT to make money in the stock market.
Instead of relying on a financial advisor or spending money on fees for financial advice, you can have ChatGPT help you with this investing strategy. Here are five ways to use ChatGPT to make money in the stock market.
1. Prompt ChatGPT To Explain Financial Terms
If you’re unfamiliar with stock market investing or want to learn more about investing, you can prompt the chatbot to help you understand financial terms and concepts. ChatGPT can educate you and explain everything you want about investing.
Here are examples of prompts that you could use to learn about stock market investing through ChatGPT:
Explain how the stock market works.
What should I know about investing in the stock market?
Tell me more about price action.
Teach me about stock market terminology.
How do you understand company financials?
These are just a few examples of prompts that you could use to learn more about the stock market. The goal is to become educated enough in the stock market so that you’re comfortable with investing your money. There’s more to investing money than just trying to find attractive stock picks. Those who have been investing for a long time understand that time in the market is more valuable than timing the market.
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2. Learn About the Stock You Want To Invest In
Warren Buffett has famously stated that you should only invest your money in businesses you understand. ChatGPT can help you better understand the companies you’re considering investing in so that you know where your money’s going.
Here’s how to use ChatGPT to learn about a stock:
Ask for an explanation of the business model.
Ask for a SWOT analysis.
Have it summarize key points from the last earnings call.
Prompt about risks the company faces.
Get a breakdown of the financials.
It’s important to remember that you should conduct a thorough analysis before investing your hard-earned money into any company. With AI-powered tools, you can conduct this research quickly, as you don’t have to browse dozens of earnings reports and transcripts. You can have all of the data you need to make an informed decision in seconds.
3. Analyze Investment Opportunities
The chatbot can analyze companies you’re considering investing in, giving you a personal financial analyst that you can access anytime. For example, you can prompt ChatGPT to compare the yearly financial statements of two stocks you want to invest in.
How can the chatbot be used to analyze companies? Here are your best options:
Compare historical data.
Break down the financials.
Look at the revenue for the company.
Analyze the earnings per share.
Provide insights on the net income.
There’s only so much analysis that a human being can handle, and sometimes it’s essential that you get the assistance of a computer to help uncover financial figures. Machine learning isn’t a new concept in investing, as many funds, lenders, and organizations are using technology for fraud prevention, investment decisions, and analyzing large sets of financial data.
4. Conduct Portfolio Analysis
Human beings naturally use emotion when deciding on investments or portfolio allocations. So, have ChatGPT look at your portfolio objectively and provide feedback on it.
You can also include your portfolio and prompt ChatGPT to determine if this is the right allocation for someone with your risk tolerance. You can then ask for different allocations based on the investing style (aggressive vs. passive). As you prompt the chatbot about portfolio allocations, you’ll learn more about stock market investing. You can also learn about different investing styles in the process.
5. Prompt ChatGPT To Pick Stocks for You
Some investors have used ChatGPT to pick out stocks to invest in. You can prompt the chatbot to pick stocks based on criteria that make a company worth investing in, like low levels of debt or a track record of providing investor returns with high growth. If you’re unsure where to start investing in the stock market, you can have ChatGPT point you in the right direction. While the technology isn’t there yet for real-time stock picks, the chatbot can help you navigate between different stocks.
It’s worth noting that major funds have been proponents of AI as they use machine learning to help analyze market sentiment and to study trends, as it can be done much quicker with a computer than a human being.
ChatGPT’s Limitations With Stock Market Investing
As tempting as it might be to ask ChatGPt for stock picks, it’s important to remember that there are various other factors to consider when investing in the stock market. While AI can analyze market sentiment and break down financial figures, many variables need to be considered, from the overall economy to consumer spending habits. As we’ve seen over the last few years, there are even situations where meme stocks can skyrocket due to retail investors rallying together.
We’ve also seen how economic factors like soaring inflation and aggressive rate hikes can impact earnings for even the most financially stable companies. Additionally, with the news changing rapidly, it’s expected that ChatGPT won’t have access to all of the valuable information needed to make investing decisions.
ChatGPT can be a personal assistant so you no longer have to spend hours on research. You can utilize ChatGPT to make money in the stock market if you’re patient and willing to take the time to learn about every investment opportunity.
Overall, AI can be used to gain access to information that would’ve taken you much longer in the past. Retail investors have unprecedented access to stock market information, but only time will tell if this is all positive.
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This article originally appeared on GOBankingRates.com: 5 Ways To Use ChatGPT To Make Money in the Stock Market