The Rapid Adoption of the Chatbot and Acceptance of Quantitative Investing

On November 30, 2022, OpenAI made ChatGPT available to the public as a part of a free research preview.  Two months later, ChatGPT reached 100 million users.  This pace of adoption proved to be faster than TikTok or Instagram.  Today, Generative AI is ubiquitous.  Many people use it every day to compose emails, write speeches, generate computer code, and much more.  In contrast, quantitative investment management has grown irregularly over the past 50 years, surely falling short of garnering 100 million users.  We find a strong commonality between Generative AI and quantitative investing and consequentially find their divergence in adoption as a bit of a conundrum.  In this note, we highlight the commonality between the “expert systems” and conclude that interest in quantitative investing should naturally increase as people become increasingly comfortable with the reliability and power of Generative AI.