Natural language processing rivals humans’ skills.
I did not write this article.
In fact, it wasn’t written by any person. Every sentence you see after this introduction is the work of OpenAI’s GPT-3, a powerful language-prediction model capable of composing sequences of coherent text. The only thing I did was provide it with topics to write about. I did not even fix its grammar or spelling.
According to OpenAI, more than 300 applications are using GPT-3, which is part of a field called natural language processing. An average of 4.5 billion words are written per day. Some say the quality of GPT-3’s text is as good as that written by humans.
What follows is GPT-3’s response to topics in general investing.
Q&A with a ‘computer’
MarketWatch: “How to invest in cryptocurrencies by GPT-3.”
GPT-3: The growing popularity of cryptocurrency means there are hundreds of opportunities to choose from, but no matter how tempting it is to buy a partially inflated coin or invest in a minor one with big expectations, only a few cryptocurrencies really offer good investment opportunities.
The market is incredibly volatile and risky so it’s essential to read up on the fundamental value and technology of the crypto companies you’re going to invest in. The market capitalization of a cryptocurrency is no indication of its worth and there are many coins which are technically worth more than their price would indicate. You can try trading, but if you don’t wish to risk losing your money you can always treat it like betting on horses.
MarketWatch: “What about investing in traditional assets?”
GPT-3: The only thing I know how to do is to write about things that I don’t know about. Before my venture, I wrote an essay offering general advice on low-risk investing. It turned out to be pretty good by my standards — but of course that’s not saying much; it’s easy for me to look smart compared with people who blow their 401(k)s or buy penny stocks and get ripped off by boiler rooms.
Investing in things like Treasury bonds TMUBMUSD10Y, 1.650% or rental real estate is usually called “traditional investing.” Investing through funds that invest in those assets is also traditional investing. If this kind of investment makes sense for you, great! But investing in traditional assets isn’t really a separate thing from investing in startup-type assets because the same rules apply.
Investing in stocks and bonds has become so complicated that no one quite understands it. Modern portfolio theory is a black box, where you put in your risk tolerance number and get back an allocation. Most people don’t even know what’s inside the black box or trust it to make good decisions. Could there be a better way?
MarketWatch: “Is gold a good investment?”
GPT-3: I’m often asked if gold is a good investment. I almost always respond that it’s a terrible investment. I want gold to be a good investment. It would be great if it went up and paid nice dividends, so I could earn money without risking my capital in tech investments. But this belief of mine clashes with a widespread popular belief that gold is the ultimate safe investment, holding steady or going up over time while everything else falls apart.
Theoretical models have indicated that gold is not a stable investment. Theories of financial economics demonstrate that the price of gold should be positively related to risk-free interest rates. This is because an investor who expects low rates will purchase gold as protection in case bad economic conditions arise in the future.
MarketWatch: “Thank you for the investment advice. I’m sure my readers will appreciate it. Any final advice?”
GPT-3: Investing is extremely simple, but that doesn’t mean it is easy. The three most important things to remember are: 1. Diversify; 2. Keep costs and taxes low; and 3. Stay the course.
If you’re seriously interested in improving your knowledge of investing, you have to devote far more than the time it takes to read one book or watch one video. The basics of investing can be learned in an afternoon. But to understand financial markets well enough to be good at it requires serious research over a period of years.
And now, some questions for readers
It’s me, Jurica. What do you think of GPT-3? Did it do a good job? Can it replace a human journalist, or is it just a good computer-assisted authorship tool? Finally, would you trust it with your money?
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