Talks of AI are venturing into every aspect of our lives. From leisure activities like planning holidays and creating gym routines, to aspects of our working lives like summarising meeting notes and aiding research, it is hard to avoid AI now.
The wealth management sector is no different and AI is starting to infiltrate the industry.
Recent headlines reported that a ChatGPT fund outperformed the top 10 most popular funds in the UK. It should be noted this was a relatively small test over a short period of time, but it still demonstrates the way AI could be used in the sector.
Realistically, ChatGPT is very unlikely to take over the investment management space. However, AI may well be able to improve it.
It could also free up significant amounts of time.
A common complaint when I speak to people in the industry is that more and more of their time is being taken up with administrative tasks. A lot of this is due to the increasing regulatory pressures faced by wealth management firms, which often results in more bureaucracy.
There is a real possibility AI could reduce this burden. Many of these administrative tasks could be done – or at least in part done – by AI, freeing up professionals’ time to focus on client matters and more complex tasks.
Along with the talk of opportunities, there is also plenty of fear about the impact AI might have. Many are scared about AI taking their jobs, while others are worried about the information it might store or put into the public domain.
These may be valid concerns in some cases.
The information put out by AI is by no means perfect. But neither is a first draft of any kind. As long as we remain critical in our approach and challenge the information provided where necessary, it can be a helpful tool.
In terms of jobs, there will likely be some that are replaced by AI. This will be relatively rare though.
In most cases, it will likely not be AI that replaces a job, but someone who knows how to use AI effectively that may replace the role.
I don’t think we should be scared of AI. Instead, we should start embracing it.
Firms that adopt it early and gain an understanding of the areas in which it can improve business practices may end up far ahead of those that do not.
So far, we have only scratched the surface of what AI can do and the extent of its reach is not yet known.
Only those that ignore AI and believe it will not have an impact have something to fear. These are the ones who risk being left behind.
