From CompliNEWS | Financial Service Intelligence Watch

Crucial investment tips for beginners:  Expert guidance vs ChatGPT’s insights

The investment advice provided by both an expert and ChatGPT for novice investors revealed some striking similarities, but the expert offered a deeper level of insight, reports Daily Investor.

Both Chantal Marx, the investment research head at FNB Wealth & Investments, and ChatGPT emphasised the importance of caution when venturing into the world of investments. They acknowledged that all investments carry inherent risks.

‘Beginners should approach investing with care and a solid grasp of the fundamentals,’ cautioned ChatGPT.

Marx shared similar sentiments, particularly highlighting the daunting nature of building a portfolio and navigating the stock market’s ‘zero-sum’ game, where there are winners and losers.

While both sources presented valuable advice for beginners, there were key points of convergence:

  • Be Educated – Both stressed the significance of educating oneself about investment basics, including asset classes, investment instruments, and risk management. Staying informed about market changes and economic conditions was also emphasised by ChatGPT.
  • Invest in What You Know – Marx encouraged investors to stick to their areas of knowledge when selecting investments. This doesn’t guarantee success, but it serves as a solid starting point for research and decision-making.
  • Have Clear Goals – Setting well-defined investment objectives, whether it’s retirement savings, buying a home, or funding education, was deemed crucial by both sources. Marx also advised against obsessing over short-term market fluctuations when investing for the long term.
  • Diversify Your Portfolio – Both ChatGPT and Marx endorsed the concept of portfolio diversification to mitigate risk. However, Marx cautioned against excessive diversification, recommending a portfolio of 20 to 30 stocks for an optimal balance between risk management and returns.

Both an expert like Chantal Marx and ChatGPT provided valuable insights for novice investors. They underscored the importance of education, clear goals, staying informed, and diversification. While ChatGPT’s advice was comprehensive, the expert offered a more nuanced perspective on specific aspects of investing, providing additional depth for those looking to embark on their investment journey.

Read the Full Daily Investor report here