A Watson-powered AI investment fund has been making waves for its relative success in balancing its vast portfolio holdings.
A $102 million AI investment fund powered by IBM’s (NYSE: IBM) Watson supercomputer is reportedly giving OpenAI’s ChatGPT a run for its money. According to a Markets Insider report, the AI Powered Equity ETF (AIEQ) is the AI-driven investment fund to watch out for. The EFT launched in 2017 and relies on the Watson supercomputer to balance its 114-holding portfolio, which is up 10.4% this year.
Comparatively, the Vanguard Total Stock Market ETF is up just 5.67% over the same period.
Assessing Watson-powered AI Investment Fund Attributes
Although popular language bot ChatGPT has gone viral, AIEQ is currently making approximately double the broader market returns. The fund is issued by ETF Managers Group in partnership with fintech firm Equbot and is quietly beating the market by 100%. However, the Watson-powered fund comes at a higher rate than the benchmark fund. According to ETF.com, the AI Powered Equity ETF is actively managed, with its charges cutting into actual investor returns. AIEQ charges 0.75%, while Vanguard costs far less at 0.03%. Nonetheless, both funds include JPMorgan Chase & Co (NYSE: JPM) and UnitedHealth Group Inc (NYSE: UNH) in their top-10 holdings.
Equbot’s chief investment officer, Chris Natividad, touched on some of the functions of the Watson-powered fund. According to Natividad, the AI-powered ETF can look beyond standard market data. He also said the fund could cull information from tweets and earnings calls. Natividad further explained:
“We’re focused on investment related data, looking at how these different types of signals impact security practices across different time horizons. The best days of the fund are still ahead of it, and just as you’ll see ChatGPT’s responses change and evolve with time and data, so will our fund.”
By comparison, although ChatGPT can render articles, emails, and dating apps, it cannot generate a portfolio that can beat the market. The chatbot’s parent company OpenAI secured a $10 billion investment from Microsoft (NASDAQ: MSFT) this month. When the deal was still developing, reports stated that the computer software giant could own up to 49% of OpenAI. Furthermore, Microsoft valued the ChatGPT creator at $29 billion, including the new investment.
ChatGPT Sees New Use Cases
As ChatGPT continues to revolutionize various sectors, online media platform BuzzFeed recently announced plans to leverage its technology. The New York-based company looks to channel the chatbot’s technology toward creating numerous content. Chipmakers are also poised to make a killing as ChatGPT, and generative AI, appear set to take over classrooms too.
Although many fear perceived repercussions from this development, several educators also strongly advocate for embracing the technology. Amid the arguments and counterarguments in favor of and against generative AI as a learning tool, University of Leeds professor Henrickson said:
“These are good moments for self-reflection, to make sure education is really doing what we want to do. If we reemphasize education as a process rather than a series of outputs, we can use these models to enhance learning.”
ChatGPT was initially launched on November 30th, 2022.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
