Difference between AI-powered stock advisory services v/s Traditional stock advisory services v/s Mutual Funds

Difference between AI-powered stock advisory services v/s Traditional stock advisory services v/s Mutual Funds

Difference between AI-powered stock advisory services v/s Traditional stock advisory services v/s Mutual Funds

When it comes to investing in equity, today, investors have many options to explore. However, too many options are not always good, as investors need to pick the best from all the good options. For example, in stock investing, no one can say that investing via mutual funds is not the right way. The critical point for investors to explore is whether there are better solutions available in the market. Therefore, it becomes really essential for investors to understand the different options they can use to invest, especially in the equity market. Investors can use one of the below four options:

Every investor who wants to start investing in the equity market needs to understand the first three options. If you are a DIY investor, you must evaluate if you can achieve your financial goals by doing it yourself. If not, what is missing? Based on your finding, you can look at all the above three options and find which fill the gaps for you. Once you know, choose the option without wasting time. 

Understand the different services for investing in the equity market

  1. AI-powered stock advisory service: Your investment decisions are driven by an AI-powered tool that evaluates your risk profile and investment horizon and accordingly suggests stocks to you. At present, there are only a few AI-based investment advisors in India.
  2. Traditional stock advisory services: Traditional advisory companies will evaluate your profile and put you under a category. The stocks are predefined under that category, and you make investments accordingly.
  3. Mutual funds: You invest in a pool of stocks managed by professionals, but you are unaware of what goes behind the scene. Also, you have no control over your investments.

Difference between the three services

Now that you have a basic understanding of the services, we can discuss how these are different and who has the edge on different parameters. 

Parameter 1: Research

The first thing you need to look for is how good the stock advisory company is in its research. Unless the company scans stocks on all crucial parameters, it cannot find quality stocks for you.

AI-based platforms like Jarvis analyze 12 million parameters before they recommend stocks. While in the other two services, there are professionals who have expertise in analyzing stocks but given human limitations, they can check companies only on some parameters. With limited analyses, the probability of going wrong gets higher.

Parameter 2: Portfolio

One of the prime objectives of a stock advisory company is to create your portfolio. In today’s time, every investor has unique financial goals, and the approach to achieving those goals cannot be generalized.

AI-based platforms create a personalized portfolio for you, taking into account your risk profile and investment horizon. Mutual funds and traditional advisors have model portfolios with no personalization. Two conservative investors are given the same model portfolio, which is not the best advisory. Stock investing is not only about picking the right stocks, but also picking stocks at the right entry point (fair valuation). Traditional advisors may give you a personalized portfolio to start with, but that turns model portfolio after a few years.

Parameter 3: Risk Management process

To make money in the market, you need to be involved in the market 24*7 – stay updated with all the news related to your stock, track micro and macroeconomics, and much more. However, it is not possible for any human being. But it is possible for AI-based service providers – they monitor stocks in your portfolio 365 days a year. In case of a red alert, you are advised to exit your position. With traditional advisors and mutual funds, the review activity is either monthly or quarterly. Hence the risk is not handled as it is by the AI platform.

Parameter 4: Portfolio rebalancing

Portfolio rebalancing is a must for every investor. It ensures your investment is in line with your financial goals. However, portfolio rebalancing works best when there is a requirement. You need not rebalance your portfolio once a quarter because it was recommended. AI-based advisors do portfolio rebalancing only when it is required. For example, the market fell in the third week of December – AI-based advisory will do the rebalancing immediately if the algo feels it is the right time, unlike other services, which may wait for the first week of the quarter to rebalance.

Parameter 5: Human Error and Bias

One of the main reasons most people, including seasoned investors, lose money in the market is human bias. Emotions are the biggest enemy of investors, but when you opt for an AI-based stock advisory service, you free your investments from biases. For this reason, an AI-driven portfolio performs better than most investors in the long run. With mutual funds and traditional advisory services, analysts are doing all the calculations, which can get wrong, or there could be some bias that may lead to losses.


We hope with the above points, you were able to understand how AI-based advisory has an edge over other stock advisory service providers. To know the power of AI in investing, you must definitely check the Jarvis Invest platform. If you are looking for AI-based investment advisors in India, you know which app to download.

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