Is the Research Department in Financial Firms on the Chopping Block? And, What about Low-Value Tasks in Legal Sector?
Yet another niche expertise which is threatened by AI could be the role of the research analyst in those prominent financial firms. The Financial Times takes a look at the possibility that those businesses will gut the whole department and operate with a few star analysts. The reality is that large language models perform well in interpreting patterns. Much of the performance of corporations follows a pattern. There are few surprises. Profits generate more profits. Subpar results tend to continue doing that. The brains at the University of Chicago, reports the Financial Times, did some research with AI. What they found is: "These outperformed median estimates when compared with those of analysts ... LLMs generate insights by understanding the narrative of the earnings release, as they do not have what we may call numerical reasoning — the edge of a narrowly trained algorithm. And their forecasts improve when instructed to mirror the steps that a senior analyst d...