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Chinese Brokerage Firm Launches AI Chatbot for Stock Trading

Tiger Brokers, a stock brokerage firm based in Beijing, China, has launched an artificial intelligence (AI) powered chatbot “to address some of the pain points” of the site’s customers, South China Morning Post reported. The firm began working on the project in January this year and is the first brokerage firm to offer such a service to its customers.

The popularity of OpenAI’s ChatGPT chatbot has opened up the application of AI to a plethora of services, with financial institutions taking a strong interest in its usage. Interesting Engineering reported last month that financial software and media company Bloomberg had launched its own AI model for the financial markets while JPMorgan Chase put its AI to identify trends from the Federal Reserve’s statements over the past 25 years and predict its next moves.

Tiger Brokers has taken AI a step further to analyze real-time market trends and make suggestions to users about trading decisions.

The power of AI to beat the markets

Anybody who has delved into the trading space knows very well the amount of data that one needs to go through and make some informed decisions about their money, if they do not wish to gamble it away. The amount of information to be analyzed increases exponentially depending on the number of stocks in one’s portfolio and factors that can impact those businesses.

With such large amounts of information to be processed, it makes sense that one deploys AI to do the hard work and identify the market trends and make recommendations. Tiger Brokers spent a good part of three months determining if it wanted to provide its own AI to its platform’s two million customers.

In January this year, the company began training its AI model using premium content that it has access to. The chatbot is now capable of analyzing current affairs and macroeconomic trends, which is expected to help users save time on market research and get the latest information.

Called TigerGPT, the chatbot is available only for a small set of users currently. Interested users might be interested in knowing that the financial company used GPT-3, the precursor to the AI model that powers ChatGPT to train its own AI. OpenAI has since launched GPT-4.

Nevertheless, AI models are also prone to “hallucinations”, a term used to describe inaccurate and sometimes even made-up responses given by the chatbot. Investment advice based on such information could be detrimental to user interest. The company is currently working with regulators to ensure that its model is compliant with current rules for such technology.

Financial markets have previously deployed robo-advisers and algorithms for investments, so the introduction of AI should not be a dramatic change, experts told SCMP.