The Predictive Edge: Outsmart the Market using Generative AI and ChatGPT in Financial Forecasting by Alejandro Lopez-Lira.
Alejandro holds a MA and PhD in Finance from the University of Pennsylvania.Today he is an Assistant Professor of Finance at the University of Florida.
In the AI-accelerated landscape of financial technology, he is taking a view that legacy quantitative methods face diminishing returns. So here, a new “predictive edge” in Large Language Models has arrived. Perhaps a mix of theory and practice for integrating AI into your investment strategies.
Financial forecasting traditionally relied on structured data: price charts, earnings ratios, and trading volumes. Alejandro is now showing the market’s greatest inefficiency resides in unstructured data. Every day a large volume of news, earnings call transcripts, and regulatory filings have broken those legacy forecasting models. Enter ChatGPT and LLMs which hold the ability to process and perform sentiment analysis at a scale previously impossible.