New Harvard Study Shows AI Could Replace Most Mutual Fund Managers
Researchers found artificial intelligence can predict 71% of mutual fund trades with stunning accuracy.
Harvard Business School researchers just delivered sobering news for traders. A new study analyzing data from 1990 to 2023 found that AI can predict 71% of mutual fund managers’ trade directions. The research suggests that thousands of high-paying finance jobs could become automated.
The study, published by the National Bureau of Economic Research, looked at the $54 trillion asset management industry and discovered that senior managers in less competitive categories are the most predictable—and thus the most replaceable.
But not all the news was bad. The study found that those with larger ownership stakes in their funds were harder for AI to mimic, so having more skin in the game makes human decision-making more valuable and less algorithmic.
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Harvard Business School researchers just delivered sobering news for traders. A new study analyzing data from 1990 to 2023 found that AI can predict 71% of mutual fund managers’ trade directions. The research suggests that thousands of high-paying finance jobs could become automated.
The study, published by the National Bureau of Economic Research, looked at the $54 trillion asset management industry and discovered that senior managers in less competitive categories are the most predictable—and thus the most replaceable.
But not all the news was bad. The study found that those with larger ownership stakes in their funds were harder for AI to mimic, so having more skin in the game makes human decision-making more valuable and less algorithmic.
Sign up for the Entrepreneur Daily newsletter to get the news and resources you need to know today to help you run your business better. Get it in your inbox.
