# Investment general discussion thread **URL:** \ **Category:** In My Humble Opinion\ **Created:** [March 5, 2025, 6:24pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169 "2025-03-05T18:24:59Z")\ **Posts on this page:** 20\ **Page:** 43
**Author:** ![Munch](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/munch/32/5281_2.png) [@Munch](https://boards.straightdope.com/u/Munch)\ **Post date:** [September 4, 2025, 1:09pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/841 "2025-09-04T13:09:49Z")
> [@CoolHandCox](#): > > So, I’m guessing there are systems that can do the actual investing for the human? Completely remove the human element. I’d be interested in learning about that. There are all sorts of ETFs and mutual funds that are built on algorithmic or AI-powered trading. ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [September 4, 2025, 2:22pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/842 "2025-09-04T14:22:49Z")
The vast, vast majority of activity on the markets today is entirely computer-driven. Humans picking individual stocks is sooo 1970s. ---
**Author:** ![Ferris](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ferris/32/11573_2.png) [@Ferris](https://boards.straightdope.com/u/Ferris)\ **Post date:** [September 5, 2025, 1:31am UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/843 "2025-09-05T01:31:40Z")
@LSLGuy - I can understand that for active fund managers, but does that still apply to passive funds? If your fund is invested in (say) a basket of forty blue chip infrastructure stocks, I would have thought there’s little scope for the ‘millisecond-scale’ automatic trading. Or have I got that wrong? ---
**Author:** ![Dag\_Otto](https://avatars.discourse-cdn.com/v4/letter/d/439d5e/32.png) [@Dag\_Otto](https://boards.straightdope.com/u/Dag_Otto)\ **Post date:** [September 5, 2025, 4:43pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/844 "2025-09-05T16:43:53Z")
I believe you are correct for a passive fund. If the fund was doing that it would increase the turnover, and low turnover is a feature of passive index funds. Trading should generally be limited to what’s needed for liquidity for operations. ---
**Author:** ![CoolHandCox](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/coolhandcox/32/16233_2.png) [@CoolHandCox](https://boards.straightdope.com/u/CoolHandCox)\ **Post date:** [September 5, 2025, 5:31pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/845 "2025-09-05T17:31:18Z")
That’s interesting. Thanks for pointing that out. I was wanting to know if there was AI that did everything, fully-automated, hands-off and there is. Per AI: _ **Fully Automated AI Management:** **AIEQ** - The AI (IBM Watson) actually makes the final buy/sell decisions automatically. Humans set the overall parameters and constraints, but the AI executes trades without human approval for each decision_. Is there anything like that for _me_ and my portfolio. I want something fully-automated that AI will actively managed like it does for AIEQ but for my unique personal situation. ---
**Author:** ![Munch](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/munch/32/5281_2.png) [@Munch](https://boards.straightdope.com/u/Munch)\ **Post date:** [September 5, 2025, 6:45pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/846 "2025-09-05T18:45:11Z")
> [@CoolHandCox](#): > > Is there anything like that for _me_ and my portfolio. I want something fully-automated that AI will actively managed like it does for AIEQ but for my unique personal situation. Yes and no. Roboadvisors have been a thing for about 10 years or so now. I see Nerdwallet and Morningstar have some articles about the better ones they recommend. But they seem to be less AI-driven than what you’re asking. They’ll take your portfolio, you set some parameters, and they will select investments according to your goals, and make transactions toward those goals. I am unsure exactly how that happens. Is it limited to mutual funds/ETFs? Will it do put/call options? What sort of guardrails does it have? ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [September 5, 2025, 11:05pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/847 "2025-09-05T23:05:49Z")
Yes, the term @CoolHandCox and @Ferris want to Google is “roboadvisor”. That’s essentially performant buy-and-hold with periodic rebalancings driven by algorithms. If you want real time algorithmic / AI hands-off trading that’s a different animal and I’m not aware of anyone that sells that except to “accredited investors” (AKA the rich). Which club your questions suggest you are not a member of. As the SEC is wound down and all the rules meant to protect the rubes from the sharks are rescinded in the name of “getting the Feds off the backs of the People”, soon enough you too will be able to invest in AI-driven scams delivered right to your phone 27x per day. ---
**Author:** ![DSeid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dseid/32/20194_2.png) [@DSeid](https://boards.straightdope.com/u/DSeid)\ **Post date:** [September 6, 2025, 2:56am UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/848 "2025-09-06T02:56:28Z")
> [@LSLGuy](#): > > If you want real time algorithmic / AI hands-off trading that’s a different animal and I’m not aware of anyone that sells that except to “accredited investors” Maybe these? > **[Top AI for Portfolio Rebalancing Tools: Features and Benefits](https://www.investglass.com/top-ai-for-portfolio-rebalancing-tools-features-and-benefits/)** > > Wondering how AI can optimize your portfolio rebalancing, including the management of exchange traded funds? AI for portfolio rebalancing automates asset > AI improves risk management by perpetually monitoring and making dynamic adaptations to portfolios, guided by real-time evaluations of risk. This automation maintains the alignment of investor portfolios with their objectives, allowing for smooth transitions in response to fluctuations in the market. > > The capacity of AI to model intricate financial circumstances facilitates precise evaluations of risk and return when rebalancing portfolios. The integration of unconventional data sources bolsters risk models and offers more nuanced understanding that informs portfolio modifications. … > > … Services such as those provided by Wealthfront and Vanguard illustrate these advantages by providing automated solutions that maintain portfolios in accordance with predetermined investment approaches while keeping costs low. … > > … Wealthfront utilizes an advanced mechanism that leverages inexpensive index funds spanning multiple international asset categories. It perpetually adjusts portfolios to maintain balance, selling assets that surpass designated targets while buying those underrepresented. This method promotes maximum tax effectiveness by employing techniques such as daily tax-loss harvesting. > > Wealthfront’s offering is economically advantageous with a mere 0.25% annual advisory fee. … > > … Betterment distinguishes itself with its investment strategy that focuses on achieving clients’ individual financial goals. By employing artificial intelligence, the platform adjusts asset allocations in response to shifting market conditions and the specific objectives of investors. > > The process of automated rebalancing maintains a consistent alignment between the portfolios and the investor’s targets, allowing for smooth adjustments when there are changes in the market. … The first one: > **[Invest for the long term on your terms | Wealthfront](https://www.wealthfront.com/investing?utm_source=google&utm_medium=brand-search&utm_campaign=brand_investing_ps-b_aw_all_dr_brand_20240520&cparam_campaignid=21320082886&utm_term=wealthfront%20robo%20advisor&utm_content=null&cparam_contentid=700408151204&cparam_adgroup=null&cparam_adgroupid=162777068316&cparam_device=a&campaignid=21320082886&adgroupid=162777068316&adid=700408151204&gad_source=1&gad_campaignid=21320082886&gbraid=0AAAAADl0KgxJUqYHUnieLVyQwnJS7X5yR&gclid=CjwKCAjwlOrFBhBaEiwAw4bYDfAxlDYYZ3ITzmgFQWkT9M9AqOGdDIeJqWuQxfxXeSf8MaGs-G0N4xoC6QYQAvD_BwE)** > > Get a diversified, automated portfolio and customize it how you want. We’ll make the trades, reinvest your dividends, and help lower your taxes automatically. 0.25% on top of fund fees does not sound cheap to me though. But on the low end for a human financial advisor. And a bit on both Betterment and Schwab’s version: > **[Betterment vs. Schwab](https://smartasset.com/investing/betterment-vs-schwab)** > > SmartAsset compares Betterment and Schwab based on usability, trade experience, offerings and cost. Here's what you need to know. ---
**Author:** ![We\_re\_wolves\_not\_werewolves](https://avatars.discourse-cdn.com/v4/letter/w/838e76/32.png) [@We\_re\_wolves\_not\_werewolves](https://boards.straightdope.com/u/We_re_wolves_not_werewolves)\ **Post date:** [September 6, 2025, 3:30pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/849 "2025-09-06T15:30:27Z")
> [@Ferris](#): > > I’m now considering whether to add to my holding while it’s effectively ‘on sale’, but I admit that good old nervous emotion is a big part of my calculation. Bargain - or ‘Good money after bad…’? “I liked it at eight, I love it at four. It’s an average down for you” - Boiler Room ---
**Author:** ![CoolHandCox](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/coolhandcox/32/16233_2.png) [@CoolHandCox](https://boards.straightdope.com/u/CoolHandCox)\ **Post date:** [September 6, 2025, 7:11pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/850 "2025-09-06T19:11:12Z")
Thanks. I was looking for robo advisor. I like the aspect that it “Removes emotional decision-making from investing.” I’ve found emotions/traits drive investing success (or failure) much much more than financial knowledge. ---
**Author:** ![DSeid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dseid/32/20194_2.png) [@DSeid](https://boards.straightdope.com/u/DSeid)\ **Post date:** [September 6, 2025, 8:19pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/851 "2025-09-06T20:19:03Z")
The human still needs to “_set the overall parameters and constraints”_ though. These tools can implement automatically and in sophisticated ways … but you still experience the volatility and are free to react to it or not. ---
**Author:** ![Snarky\_Kong](https://avatars.discourse-cdn.com/v4/letter/s/a183cd/32.png) [@Snarky\_Kong](https://boards.straightdope.com/u/Snarky_Kong)\ **Post date:** [September 6, 2025, 8:34pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/852 "2025-09-06T20:34:19Z")
Wealthfront asks a handful of questions to decide what risk tolerance you have from 1-10 and then it’s automatic within that group. The risk level just sets the proportions of domestic equity vs foreign equity vs bonds vs whatever. Then trades are periodic to rebalance. At a certain level they try to move away from index funds and statistically match the ETFs they would have bought anyway, saving the 0.03% or whatever fee that VTI charges. ---
**Author:** ![DSeid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dseid/32/20194_2.png) [@DSeid](https://boards.straightdope.com/u/DSeid)\ **Post date:** [September 6, 2025, 9:17pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/853 "2025-09-06T21:17:28Z")
> [@Snarky\_Kong](#): > > Then trades are periodic to rebalance. Based on [drift](https://support.wealthfront.com/hc/en-us/articles/209353766-How-often-do-you-rebalance-my-Automated-Investing-Account) not time period, factoring tax impact of any gains. The focus is on keeping “risk” (meaning volatility) at the comfort zone. To me that is only part of the sales pitch for rebalancing. The other bit is the alleged outperformance by moving from a class outperforming while it is outperforming into an underperforming class before it comes back up. ---
**Author:** ![CoolHandCox](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/coolhandcox/32/16233_2.png) [@CoolHandCox](https://boards.straightdope.com/u/CoolHandCox)\ **Post date:** [September 6, 2025, 9:27pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/854 "2025-09-06T21:27:36Z")
Good points. I would appreciate it in two simple ways: 1. AI won’t forgot. The rebalancing to less volatile/less risky needs to be done but it’s easy to forgot. Especially in very good times or very bad times. 2. AI won’t panic. When times are bad it’s easy to rationalize decisions that are really just a panicked reaction that should be ignored. It’s really simple but I have trouble with the simple stuff. It’s like doing basic preventive medical checkups - I’d love it if AI could schedule all that for me. I’d go if it was scheduled. Me remembering what needs to be done and actually scheduling it - crapshoot. ---
**Author:** ![DSeid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dseid/32/20194_2.png) [@DSeid](https://boards.straightdope.com/u/DSeid)\ **Post date:** [September 6, 2025, 9:50pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/855 "2025-09-06T21:50:49Z")
And 3. AI doesn’t get afraid of missing out on more of a run. ---
**Author:** ![Sage\_Rat](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sage_rat/32/399_2.png) [@Sage\_Rat](https://boards.straightdope.com/u/Sage_Rat)\ **Post date:** [September 6, 2025, 9:55pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/856 "2025-09-06T21:55:40Z")
An alternative would be to buy an AI powered ETF: [5 AI-Powered ETFs: Pros And Cons | Bankrate](https://www.bankrate.com/investing/ai-powered-etfs-pros-cons/#:~:text=The%20ETF%20is%20technically%20passively,in%20existence%20since%20March%202021). Not a recommendation, just pointing out that they exist. ---
**Author:** ![Railer13](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/railer13/32/9742_2.png) [@Railer13](https://boards.straightdope.com/u/Railer13)\ **Post date:** [September 6, 2025, 10:06pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/857 "2025-09-06T22:06:04Z")
> [@Sage\_Rat](#): > > An alternative would be to buy an AI powered ETF: > > [5 AI-Powered ETFs: Pros And Cons | Bankrate](https://www.bankrate.com/investing/ai-powered-etfs-pros-cons/#:~:text=The%20ETF%20is%20technically%20passively,in%20existence%20since%20March%202021). Just for grins, I ran those 5 ETFs through the Marketwatch fund comparison tool, along with Vanguard S&P 500 index fund (VFIAX). Results were mixed. [https://www.marketwatch.com/tools/fund-comparison?tickers=AIVL,AIEQ,BUZZ,AIVI,AMOM,VFIAX&filter=returns](https://www.marketwatch.com/tools/fund-comparison?tickers=AIVL,AIEQ,BUZZ,AIVI,AMOM,VFIAX&filter=returns) Hopefully you can click on the link and see what I’m seeing. ---
**Author:** ![Snarky\_Kong](https://avatars.discourse-cdn.com/v4/letter/s/a183cd/32.png) [@Snarky\_Kong](https://boards.straightdope.com/u/Snarky_Kong)\ **Post date:** [September 6, 2025, 10:13pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/858 "2025-09-06T22:13:25Z")
Roboadvisors aren’t AI, for precision sake. ---
**Author:** ![Pardel-Lux](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pardel-lux/32/20182_2.png) [@Pardel-Lux](https://boards.straightdope.com/u/Pardel-Lux)\ **Post date:** [September 6, 2025, 10:20pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/859 "2025-09-06T22:20:24Z")
AI has a flaw: it is trained on data from the past. If something new happens, something radically unexpected, it will be out of its depth. No, I don’t know what this event could be – it wouldn’t be unexpected if I knew, but things happen. Maybe the AI might come to the conclusion that tanking the investments to zero is the best strategy, like the other AI that [crashed the Boeing planes just over five years ago](https://mashable.com/article/boeing-737-max-aggressive-risky-ai) (yes, it was another level of AI and there were other factors involved, but who knows what level of AI the banks use and what other factors will be involved? Everything is called AI or blockchain nowadays). If something really extraordinary happens there will will be troubing times for everyone, but AI is a black box. We don’t know why it does what it does, which means we don’t know what it will do. I have a problem with that, unlikely as it may seem that (sh)it happens. ---
**Author:** ![DSeid](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dseid/32/20194_2.png) [@DSeid](https://boards.straightdope.com/u/DSeid)\ **Post date:** [September 6, 2025, 10:30pm UTC](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169/860 "2025-09-06T22:30:50Z")
> [@Railer13](#): > > Hopefully you can click on the link and see what I’m seeing. Interesting. The “social sentiment” one is doing impressively well. Of course those are the stocks that I’d usually be betting against, recognizing that the train has left by the time I have even heard of them and they are likely irrationally overpriced. But their AI may pick up on the irrational memes before they really take off and be able to better read when to jump off … Huh. I have a _little_ cash sitting in my “play” portion of my retirement account. (Different than the cash sitting to fund what might be needed in a short to medium term if a crash and my income craters too.) Maybe just to give me a reason to follow it … [Previous page](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169.md?page=42) [Next page](https://boards.straightdope.com/t/investment-general-discussion-thread/1015169.md?page=44)