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Are Robots Coming To Take Investor Jobs on Wall Street? (nypost.com)
From an article on NYPost: More investors are warming to the cold, steely embrace of the increasingly sophisticated, low-cost automated robo-advisers. The primary reason is to save money on those fees and charges. Nearly one in three investors says these machines are superior at picking stocks and lessen their risk, and almost as many say the machines are better at selecting investments for retirement than human brokers, according to a new study of US investors by market research and consulting firm Spectrem Group.
It comes down to the law of large numbers. You cant predict stock performance anymore than you can predict football game outcomes because too many variables and people are moving on the "field." Traders never outperform the overall market in the long term. Not EVER. Bots wont be better at it than humans since they run the same retard algorithms which are no more accurate than a gamblers "system." Buy an index ETF and avoid fees altogether. What a sales desk can do for you is give you access to unorthodox investing instruments that don't exist to those of us poor people with nothing more than E-Trade account. If you want to buy mortgage back securities or ABS notes you need to go through a desk and have 7 figures sitting with them. Regular investors don't get to play with these things but stock picking is for morons who failed stats.
They're all looking for the same outcome: making the most money. The "outcomes" you described are just different strategies for achieving that one outcome.
The evaluation function for AI financial advisors is ridiculously simple compared to many other applications of AI: how much money does it make? It'll just be an arms race of who has the best algorithms until an equilibrium is reached with everyone making the most money possible (probably a rate of return equal to world GDP growth), which will eventually be punctured by some event outside the consideration of the algorithm, kicking off another race, repeat.
Correction: they are all looking to make the most money based on what they perceive is an acceptable level of risk.
Someone with $10M might be willing to go "all in, make me the most money assuming I'm willing to lose 50% of it", while someone approaching retirement with $1M might be willing to say "make me the most money assuming I'm only willing to lose 2% of it."
In my experience with a not-publicly-traded company that decided to create an Employee Stock Ownership Plan (ESOP), it was just a way for the owners to take cash out of the company without selling it on the market. Turns out they allotted shares worth 1/3 of the company to the ESOP, and had the coroporation borrow money in order to purchase those shares from the owners and give them to employees instead of contributing to 401Ks (I called it the "all eggs in one basket retirement plan"). The owners got cash and the employees got non-voting shares that dropped in value every year (especially 2009).