Stock ScreenerStock IdeasArtificial Intelligence Investing

Artificial Intelligence Investing

Zen Ratings' AI leverages a neural network trained on 20+ years of data to find stocks with a high chance to beat the market.

Artificial Intelligence has changed the world of investing. Investing platforms that leverage AI can make all sorts of tedious tasks a breeze: automated portfolio management, features like rebalancing and tax loss harvesting, and the topic that we’re here to discuss today: Stock research. 

When it comes to researching potential investments, AI can provide insights and recommendations to stock traders and investors, quickly digesting and making sense of piles of data that would take the average person years to sort through. 

However, not all AI models are created equal. It’s crucial to seek out high quality AI investing resources that give you access to a wide range of tools and data to help you analyze and pick the best stocks for your goals.

In this article you’ll learn:

• How can AI help you make better investment decisions?
• The pitfalls of AI and why you shouldn’t trust it blindly
• One of the best ways to identify better stock picks using AI

But first, let’s talk about how AI investing works in general and its impact on the markets.

AI investing can mean different things to different people. So let’s go over it.

First, when you discuss AI investing, you might be talking about investing in AI stocks, or stocks that are either creating AI technology or benefiting from AI advancements. Learn more about how to invest in AI here.

However, for the purposes of this article, we’re talking about AI-assisted investing, or how to make use of AI to choose stocks.

AI investing leverages artificial intelligence, machine learning, and big data analytics to help investors make smarter investment decisions. These tools analyze massive datasets, recognize patterns, and provide predictive insights that can optimize portfolio management, risk assessment, trade execution, and investment decision making.

Let’s talk for a minute about how AI is changing financial markets. 

One of the most significant impacts of AI is its ability to process vast amounts of market data quickly and accurately. 

This capability allows investors to make more informed decisions based on comprehensive data analysis. AI-powered tools can scrutinize market trends, identify patterns, and predict future movements, providing investors with a competitive edge in the financial markets. 

Additionally, AI can automate trading processes, reducing the need for human intervention and minimizing the risk of emotional bias. This automation not only enhances efficiency but also ensures that trading decisions are based on data-driven insights rather than human emotions.

Is AI really capable of making you a better investor? Here are some of the benefits:

• Speed and Efficiency: AI processes financial data exponentially faster than humans.
• Data-Driven Decision-Making: AI can identify patterns and insights that might not be immediately discernable.
• Emotion-Free Investing: AI doesn’t have human emotions, so it removes things like FOMO and human bias from the mix.  
• Customization & Automation: Some AI investing tools can be tailored to different risk levels and investment strategies.
• Identify Stocks and Sectors You May Not Have Considered: When you filter for stocks that score high AI ratings on WallStreetZen, you may discover stocks and sectors you didn’t even realize were high-potential. 

WallStreetZen’s Zen Ratings system helps investors make smarter investment decisions by distilling 115 factors proven to drive stock growth into an easy-to-read letter grade.

One of those factors? An advanced AI algorithm that leverages a neural network trained on 20+ years of data to find stocks with a high chance of beating the market. In large part thanks to this AI model, which took 2 years to develop, stocks with an overall Zen Rating of A have an impressive track record of 32.52% annual returns. 

Not only does this system detect patterns beyond human detection. It also applies cross-validation techniques to ensure adaptability across different market conditions, preventing overfitting. 

By integrating multiple factors—earnings, cash flow, price trends, and industry shifts—into a single, actionable insight, it provides retail investors with data-driven, forward-looking stock analysis.

To start, you can use this list to locate stocks with a high AI rating. But keep in mind that the AI rating is the fastest-moving element within our Zen Ratings model, meaning it can shift faster than other factors like Value, Financials, or Growth.  

However, don’t just look at the AI score. Be sure to focus on stocks that have an overall A or B rating for the best chances of locating stocks that have passed the full 115-factor analysis and show signs of being primed to outperform. 

Why focus on A and B-rated stocks? Because they’re the best of the best. With both the overall and Component Grade, A means a stock is in the top 5% — the best of the best. Stocks with an A rating have historically delivered 32.52% annual returns. B is still quite impressive, denoting that a stock or the Component Grade is in the top 20% among the stocks we track. Stocks with this rating have historically delivered 19.88% historical returns. 

First, remember that AI is here to offer assistance — not do all the work for you. Here are some ways to manage risk with AI:

Have a Strategy: A well-defined investing strategy is essential when integrating AI tools, as it helps in aligning AI-driven insights with your financial goals. 

Don’t Just Look at AI: As noted above, looking at AI factors alone may not be enough to identify the highest potential investments. One reason why is that despite AI’s intelligence, it doesn’t always factor in the human emotions at play both on the part of companies and investors. So, looking at more factors can give you a bigger-picture view. 

By looking at a company’s overall Zen Rating in addition to its AI score, you can get a better idea of a stock’s overall quality and its areas of strength. 

Finding valuable stocks before they take off requires a lot of number crunching and data analysis — making AI the perfect companion for any day trader or active investor.

But AI can get things wrong, and there are no guaranteed results with any trading strategy. This is precisely why software like WallStreetZen is so beneficial. In addition to leveraging AI-powered stock-picking tools, WallStreetZen also allows you to look at traditional fundamental metrics and results that have been backtested, so you have a built-in set of checks and balances.

If you’re interested in leveraging AI-powered analytics with expert insights to locate undervalued stocks, consider subscribing to our stock-picking newsletter, Zen Investor.

Helmed by 44-year market veteran Steve Reitmeister, each stock in the Zen Investor portfolio has passed the 115 factors within the Zen Ratings system utilizing proprietary AI algorithms to evaluate stocks. However, that’s just part of a broader four-step methodology used to complete a full evaluation of each stock.

Zen Investor is unique in the AI stock picking space as it also incorporates human expertise — such as top analyst selections and hand-picking the best stocks— for more refined stock selection. Gain access to the market-beating Zen Investor portfolio now.