Artificial Intelligence – How It Can Impact Your Investment Portfolio

Artificial Intelligence is going to make our world more efficient and a lot easier, but in the process, it is also going to disrupt many jobs in the future, and many companies will either become more efficient because of it or may become obsolete. The companies that I feel will benefit from it the most are the already large mega corporations. The Googles, Facebooks, Tesla’s, Microsoft’s, and other major tech companies have the most to gain. Take Your Retirement Readiness Quiz Now The biggest reason is they are the companies really innovating in this area and will be creating the products and services technology that will be in use surrounding AI. I believe many of the losing companies are the companies that would be considered Value Stocks, at this point in time. The Value companies have been more focused in the past decade with paying large dividends, and really have not invested enough into research and development to develop Artificial intelligence around their business’s. I can assure you Tesla’s profit margins are much larger now than any other auto manufacturer because of the efficiency they have created in the manufacturing and quality of their automobiles because of their research and development of Artificial intelligence. They are the farthest along in creating a self-driving car, which can only be accomplished with Artificial intelligence. Because of their focus and investment into this technology they have created a massive competitive advantage in the automobile industry that will make it very challenging for other automobile companies to catch up to.  This is creating a situation where many value stocks that conservative investors like to invest in may not be that conservative when you understand how easily they can be disrupted. Another way to understand how artificial intelligence can make our world more efficient is to look at what the city of Miami is doing with artificial intelligence when it comes to collecting garbage. Every large dumpster has sensors that will read how quickly the garbage can is getting filled, what is being thrown away, and can notify and dictate what dumpsters need to be picked up, and which dumpsters do not need to be picked up. So, in the past when a garbage truck would go out and empty every garbage dumpster regardless of whether it is full or not now the garbage routes are way more efficient because the garbage truck is only picking up the dumpster that are full. The other advantage to the city of Miami’s use of artificial intelligence is they can tell what garbage is being thrown away. This can help focus their recycling education efforts and create awareness around how and what we dispose of. The efficiencies that can be created with this data can save room in garbage dumps and improve recycling efforts, having a major impact on the environment. Your investment portfolio may be impacted by artificial intelligence because the companies that have invested and are investing in AI will have such a competitive advantage over the companies that have not. Take Your Retirement Readiness Quiz Now The opinions expressed herein are those of the firm and are subject to change without notice. The opinions referenced are as of the date of publication and are subject to change due to changes in the market or economic conditions and may not necessarily come to pass. Any opinions, projections, or forward-looking statements expressed herein are solely those of author, may differ from the views or opinions expressed by other areas of the firm, and are only for general informational purposes as of the date indicated.