Artificial intelligence is increasingly being used by financial advisors, but most experts agree it should assist with investment analysis rather than make final investment decisions on its own. The technology can process large volumes of financial data quickly, helping advisors identify patterns, market trends, and risk factors that might otherwise take hours to analyze.
However, relying fully on AI for portfolio decisions is still considered risky. A recent six-week study by the AI investment platform DeepVest tested major general-purpose AI models on real investment workflows and found that they failed about 85% of the tasks, often producing incorrect calculations or hallucinated information. This highlights the limitations of using generic AI tools for complex financial decision-making.
Because of these limitations, most industry professionals recommend using AI as a decision-support tool rather than an autonomous advisor. AI can help narrow down investment options, analyze thousands of variables, and generate insights, but human advisors should still evaluate the results and make the final call.
Another concern is regulation and fiduciary responsibility. Financial advisors must follow strict rules around client data and investment recommendations, and using AI without proper oversight could risk compliance violations or inaccurate advice. For that reason, firms are encouraged to implement clear AI usage policies and ensure advisors verify AI-generated insights before acting on them.
