Money & the Markets
Money & the Markets explores how financial markets really work through data, history, and real-world experience.
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Money & the Markets
Just wanted to share a follow-up prompt based on a comment to my video, "I Asked ChatGPT How to Invest My Money — Here’s What It Recommended". The comment was skeptical if AI could ever handle more complex investment strategies like structured products and options. I tested it by asking ChatGPT, v. 4o to provide me a timely options strategy today that had the best reward to risk ratio.
The output was actually a real strategy that could be implemented based on what's known as a call backspread options setup for META as the underlying stock. ChatGPT notes the maximum loss, potential gain and breakeven point to satisfy my high reward to risk request, and provides specific strike prices and premium costs. It doesn't provide me with the intended expiration date, but perhaps it wants me to choose the expiration dates that correspond to the target premiums.
However, there are some caveats I noticed:
First, the current price for META is wrong. ChatGPT says the current stock price of META as of May 9, 2025 is $530 per share. That's not correct. It's currently at $595 at the time of this posting, and hasn't been at $530 since April 30, 2025. Perhaps a bug in its logic is causing ChatGPT to reference the most recent month-end price as the current price and interpreting it as such. For that reason, the suggested strike prices of the options from ChatGPT for this recommended strategy is not what it intended.
Second, the output to the question I asked ChatGPT varies depending on the history of my chat. When I tried the exact same question on an entirely new chat window, it didn't provide me with a specific strategy that I could implement today, but rather a generic description of a "put backspread". Rather, an example is offered using hypothetical strike prices and premiums explaining how this particular options strategy works, but there is no META or other underlying security that it proposed. The screenshots that I post here were generated after asking ChatGPT a series of other questions that demonstrated that I had some knowledge of the subject matter.
So it may have the potential to handle more complex investment strategies, although there are some issues to work out and better understand.
What are your thoughts? Any other errors in ChatGPT's response below that I missed? Are you impressed that it can provide such recommendations or not so much?
7 months ago | [YT] | 5
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