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Using GPT-4 for Financial Advice

Author

Listed:
  • Christian Fieberg
  • Lars Hornuf
  • David J. Streich

Abstract

We show that the recently released text-based artificial intelligence tool GPT-4 can provide suitable financial advice. The tool suggests specific investment portfolios that reflect an investor’s individual circumstances such as risk tolerance, risk capacity, and sustainability preference. Notably, while the suggested portfolios display home bias and are rather insensitive to the investment horizon, historical risk-adjusted performance is on par with a professionally managed benchmark portfolio. Given the current inability of GPT-4 to provide full-service financial advice, it may be used by financial advisors as a back-office tool for portfolio recommendation.

Suggested Citation

  • Christian Fieberg & Lars Hornuf & David J. Streich, 2023. "Using GPT-4 for Financial Advice," CESifo Working Paper Series 10529, CESifo.
  • Handle: RePEc:ces:ceswps:_10529
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    References listed on IDEAS

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    More about this item

    Keywords

    GPT-4; ChatGPT; financial advice; artificial intelligence; portfolio management;
    All these keywords.

    JEL classification:

    • G00 - Financial Economics - - General - - - General
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions

    NEP fields

    This paper has been announced in the following NEP Reports:

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