Until recently, investors looking for assistance with their equity investments went to traditional advisors. It made a lot of sense, as most investors had more or less similar financial goals. However, human preferences have changed in the last few years, and traditional advisors may not be the best equity advisors in India now.
Today, everyone is using technology in every sphere of life. It has made life super-easy – in most areas for us. The use of technology makes us super efficient. The question is – if technology can also help us make money from the equity market, why should we not use it? Let us look at the advantages of AI over traditional advisors for equity investment.
A model portfolio by traditional advisors is no longer a solution
A model portfolio is a diversified group of assets designed to achieve a specific return. It has a certain risk associated with it. Over the years, traditional advisors have created a model portfolio and sold it to every client for their equity investment.
Today, however, each investor’s financial requirements are unique. Everyone has unique requirements – some want to retire at 60, while others plan to retire at 45. So a model portfolio is no longer an ideal solution. Personalization is the key today.
Platforms like YouTube and Facebook have become really popular in recent years because they give you personalized content. If you like watching funny videos on YouTube, you will find similar videos in the suggestion list.
If the content you want to consume is personalized, why not your equity portfolio? It is possible now with an AI-driven platform. AI platforms have an edge over traditional advisors. Let us look at them in detail.
How is AI better than traditional advisors?
Below are some limitations of traditional advisors and how AI overcomes them:
Traditional advisors can handle a limited number of cases
If your job requires you to meet people daily, you know that you can manage only a certain number in a day and a month. Similarly, traditional advisors can only handle a limited number of clients – if they are to create a personalized portfolio. To serve more clients, they design a model portfolio, which we discussed above, is not a great option in today’s time. On the other hand, AI can create a personalized portfolio for 10, 100, or 1000 investors in a day. Scalability is beyond imagination.
Human brain can only process limited information
Traditional advisors can scan only limited information before sharing information on a stock or creating your portfolio. The probability is high that they miss important information, which may lead to losses. With AI, that is not possible, as AI scans millions of data points before suggesting a stock to you. For example, Jarvis scans 12 million data points to create your personalized portfolio, which lowers the chances of going wrong. For the same reason, using AI for stock trading is becoming popular. Traders can now increase their accuracy using AI tools as they can analyze more data in less time.
Stock investment requires continuous monitoring
Assume that advisors create a personalized portfolio for you with the best stocks. You have 20 companies in your portfolio now. However, having quality stocks in a portfolio is not enough for long-term wealth creation. The best equity advisory in India is about continuously monitoring the portfolio, as Indian investors are not financially advanced to do it on their own – they need hand-holding. For traditional advisors, it is impossible to track everything as so much happens around stocks in a given quarter – results, management commentary, brokerage firm rating, audit report updates, and media coverage. An AI-based system, on the other hand, can monitor stocks in your portfolio 24 hours a day, seven days a week, and significantly reduce the risks.
The number one reason equity investment has never been the primary choice of investors in India is that it is risky, and Indian investors are unequipped to manage the risk. Yes, we always had advisors, but as mentioned above, they had their own limitations. Investment advisory firms charge hefty fees, which makes the services unaffordable for most.
Now, using AI for stock trading and investing is possible and pocket-friendly. Every investor can register on the Jarvis platform and start their equity investment journey. Jarvis is one of the most reasonable ways to invest in the equity market today.