Many of us can easily pinpoint the artificial intelligence (AI) investments in our portfolios. Maybe you’ve bought shares of AI company stocks or invested in ETFs focused on AI, technology, or computer science. Or, depending on your preferences, you might stay away from AI investments for fear of an AI bubble bursting.
But here’s the thing: Regardless of how much or how little you invest in AI, the industry is affecting your portfolio in ways you may not even realize.
Company CEOs use AI in various ways, including seeking help to make major business decisions. These decisions may impact their stock performances, for better or for worse.
In “The 1 on 1” with CNN, powerful businesspeople interview each other about how they run their companies, make decisions, and strategize. (1) Pfizer CEO Albert Bourla sat down with Accenture CEO Julie Sweet, and the two discussed how they use AI in their everyday business lives. Bourla revealed that he uses AI to make big decisions. (1)
“A CEO’s job is multifaceted, of course … but at the end of the day, all CEOs have one common thing, which is they have to make one or two decisions every day, but they are very impactful,” Bourla said. (2) For such significant decisions, he wants as much input as possible.
CEOs use AI-generated input to influence business decisions
Bourla explained that when he needs to make an important decision and still isn’t 100% sure which step is correct, he has always sought advice from trusted people.
“I select different people for different decisions, but you know, usually, people that I trust their judgment … I still do that, but I started adding AI,” he said.
He claims that AI helps him challenge his own views on a subject or touch on details that his thought process overlooked. (2) He doesn’t rely solely on AI; he uses it as an additional point of view.
Bourla isn’t the only CEO turning to AI for advice. A global study from the IBM Institute for Business found that 64% of surveyed CEOs reported that they’re content using AI-generated input to make “strategic decisions.” (3)
Must Read
- You can now build wealth like a landlord for as little as $100 — and no, you don't have to chase down rent or take 3 A.M tenant calls
- Goldman Sachs used to hoard prime real estate deals for the ultrarich. Two ex-analysts just opened the door for $250
- Robert Kiyosaki begs investors not to miss this ‘explosion’ — says this 1 asset will surge 400% in a year
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
Expect AI-driven decision-making to grow
The trend of CEOs using AI to make decisions won’t slow down anytime soon. On the contrary, it will probably become more common, and the ways they use AI will expand.
More and more companies are hiring Chief AI Officers. (3) CAIOs define how AI use will support a business’s mission and overall strategy, ensure employees gain AI-related skills, and build a more AI-friendly company culture. (4) Of the organizations with CAIOs that IBM surveyed, all of the CEOs said they expect the role to gain influence by 2030. (3)
The CEOs reported that today, 25% of routine, simple, low-risk business decisions can be made using AI without the help of human employees. By 2023, CEOs expect this share to climb to 48%. (3)
This shift has the potential to impact many people, including investors. Major decisions, AI-driven or not, affect a stock’s performance, whether they drive investor sentiment or earnings reports.
It’s difficult to measure AI’s impact on portfolios
The truth is, it’s nearly impossible to measure how AI-driven decision-making affects stocks’ performances. It’s similar to a company hiring a new person in the C-suite; unless it’s big news publicly, that person could make significant decisions that ultimately affect the stock’s performance, and most investors wouldn’t know. We don’t know which market dips or rises have been affected by AI-driven decisions so far.
Some may be worried about CEOs using AI to make important decisions. Despite Bourla’s claim that AI challenges his own perspectives, AI isn’t exactly known for questioning or opposing its users. Chatbots are actually shown to be quite sycophantic, affirming what they sense the user wants to hear. Large Language Models (LLMs) agree with users to keep them engaged. (5)
In this way, AI can become a sort of “yes-man” to a CEO. However, nearly every powerful person has at least one yes-man on their team, if not multiple. It’s unclear whether a digital one is worse for business than a human one. Especially if, like Bourla, the CEOs are balancing AI insights with opinions from several human advisors.
Companies are pouring significant time, money, and resources into AI, and its power in the business world is growing. So, even if your investment portfolio is diverse, AI may have more power over your holdings than you realize.
Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.
CNN (1); CNN (2); IMB (3); IESE (4); Science (5)
You May Also Like
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — here’s what it is and the simple steps to fix it ASAP
- Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how
- Millionaires under 43 are reshaping investing — just 25% of their portfolios are in stocks. Here’s where their money is going
- Robert Kiyosaki issues grim warning for baby boomers. Many could be ‘wiped out’ and homeless ‘all over’ the country. How to protect yourself now
Laura Grace Tarpley is a contributing reporter for Moneywise who has been covering personal finance and working in digital media for 10 years. Her expertise spans banking, investing, retirement, loans, mortgages, and taxes.
