While it’s true that artificial intelligence (AI) is certainly not a new concept, it’s important to keep in mind that the tools we now think of when we hear the term have really only existed for about two years. ChatGPT, which many think of in terms of AI, the way that people consider “Google” and “search” interchangeable, only debuted to the public in November 2022.
In that time, AI has revolutionized just about every area of our lives that you can think of – with investment strategies being perhaps at the top of that list. Every day, AI tools are providing investors with the powerful tools needed to enhance portfolio management in a way that would have been unthinkable even a decade ago. Understanding the extent of this impact as we head into 2025 is the key to taking full advantage of it for your own purposes moving forward.
AI-driven platforms Democratize Investing
In the not-too-distant future, we will see artificial intelligence built into the very operating system of the devices we’re using to some degree. We’re already seeing this to a certain extent with options like Microsoft Copilot and Apple Intelligence in the mobile iOS ecosystem. When it comes to investing, AI is making entry more accessible than ever for the average person.
In real estate, for example, skip tracing technology has been used for decades to help uncover property owner contact information. This is especially common for investors looking to buy off-market properties. However, getting the contact information is only part of the puzzle: making a cold call can be intimidating at best, especially for those new to real estate. That’s where AI comes in. AI-powered tools can help investors of any experience level confidently take that next step by helping them decide on an appropriate offer, writing scripts for conversations, and answering questions about the process or potential deal. With this level of support, even newbies to real estate can confidently take that next step to close an off-market deal.
AI-driven platforms are lowering the barriers to entry for first-time investors across other various markets as well. These platforms simplify complex processes by breaking down large datasets into actionable insights, helping novice investors understand market trends, spot opportunities, and assess potential risks without needing years of experience. By offering real-time guidance and personalized recommendations, AI empowers new investors to make informed decisions with confidence. As AI continues to evolve, it’s poised to democratize investing further, making it more accessible to those who might have previously felt excluded from the financial world.
Predictive Analytics Make Investing More Strategic
Another benefit of AI tech in portfolio strategies is the broader category of predictive analytics. From a 10,000-foot view, predictive analytics are about letting the past inform the future. Based on historical data, you can see which direction trends are headed in and hopefully make educated guesses about what the future will look like.
In a more granular sense, however, predictive analytics can help with tasks like market forecasting. To continue the real estate example, investors can forecast not only property values but also rental yields, price trends, and more. This can help with everything from risk mitigation to price optimization (if you’re the type of investor who rents out properties to others).
Beyond real estate, predictive analytics can be a game-changer for new and experienced investors across different asset classes. In stock market investing, it can help spot emerging trends, identify undervalued stocks, and anticipate market volatility. By analyzing historical price movements and economic indicators, predictive models allow investors to make more informed decisions about when to buy, sell, or hold. In alternative investments like commodities, predictive analytics can aid in navigating complex markets by highlighting patterns that might not be obvious through traditional analysis. For those managing diversified portfolios, this technology helps balance risk and return by offering insights on asset allocation based on market behavior.
As AI-powered predictive analytics continue to evolve, they are making investing more accessible, data-driven, and strategic for everyone—from casual investors to seasoned professionals.
Decision-Making is Becoming Automated
These types of AI-powered innovations also allow for the real-time analysis of vast amounts of market data. We’re living in an era when more data is being created than ever during virtually every minute of every day. Contained inside that data is the key that will let you make the right decision at the right time, nearly every time.
AI makes it not just easier to uncover that insight but faster as well. This enables more informed decisions than ever, along with identifying true hidden opportunities that otherwise would have gone undiscovered.
Part of this has to do with how AI algorithms can identify patterns in data that humans may overlook, regardless of their intentions. Machine learning and the aforementioned predictive analytics can also learn from that data and enable true predictive decision-making.
But this isn’t just limited to letting the AI tool make the decisions for you, of course. Task automation can automate routine decision-making tasks that would otherwise require you to complete manually. If you’re tasked with a series of decisions with one correct and incorrect answer, and all you need to do is apply logic to determine which is which, there’s no reason an AI-powered tool can’t be trained to take this off your plate.
That way, the decisions still get made, and the tasks still get completed – it’s just that you’re now free to focus more on those matters that truly need you.
This type of automated decision-making can also lead to a more consistent level of decision-making. That is to say, because AI systems follow pre-defined rules (or, at the very least, patterns they learn over time), they can be more consistent in their decision-making than humans ever could. Human bias, even the unconscious kind, is totally eliminated. When trained properly, AI systems can reduce errors and be far more fair and transparent than humans ever could. This is before you get to the other benefits of the process, as outlined above.
Vast Amounts of Market Data? No Problem
Overall, one key thing to remember about all this is that AI, by its nature, continues to evolve. The “latest and greatest” tool available today could be woefully inadequate six months from now because “continuous improvement” is a big part of what artificial intelligence was designed to do.
That is to say, these tools get better at their jobs as they have more of an opportunity to do them. They get better at ingesting market data. The insights they derive from that data become richer. The tools themselves create opportunities for innovation, to the point where there are features we will enjoy in the future that likely hadn’t even been conceived of by users.
As AI continues that evolution, it will be pivotal in shaping more dynamic, responsive, and adaptive portfolio strategies. Exactly how that happens will vary, but that over-arching theme will remain constant. This, in turn, will empower investors to navigate the inherent complexities of the modern financial landscape with ease, creating the types of opportunities that previous generations would have to see to believe.
