AI such as ChatGPT will create an early road map for investors

Artificial intelligence software is going to transform these key industries, and investors should be primed to take advantage.

The possibilities for investors from artificial intelligence platforms such as ChatGPT are only just being realised.

Fear over job losses and privacy are swirling around the rise of ChatGPT, but opportunistic investors now have a road map of where artificial intelligence will make a difference: IT, financial services, mining and healthcare.

A benchmark report from KPMG on AI – typified by the ChatGPT program – concentrates on risks and regulations.

But it just so happens some of the hottest areas overlap neatly with the ASX where mining and financial services are the two biggest sectors by market capitalisation.

Similarly, the healthcare industry, described by KPMG’s Dean Grandy as the sector with “a particular appetite” for AI, carries a string of blue chip stocks including CSL, Ramsay and Resmed.

ChatGPT itself, when asked to offer examples of Australian stocks actively using AI, takes only seconds to throw up some listed companies “operating in the field”. These include Appen, Computershare and Wisetech.

The KPMG report titled Navigating AI suggests the current regulatory framework on AI is inadequate and will “continue to be an impediment to progressing AI in Australia”. But it also offers an early road map of how flourishing AI technology will influence key industries.

The report identifies major opportunities where productivity could expand in three key business areas.

The first is in financial services. Here the big changes may come from an acceleration of share trading, expanded services – and for the insurance industry there are opportunities in the modelling of insurance risks and prices.

In the mining sector there is the potential of machine learning to improve exploration activity. Seismic surveys and modelling can also be used to assess the stability of landscapes and reduce risks. AI technology will also accelerate the move towards self-driving vehicles. Healthcare offers enormous potential in diagnostic services, while in biotech there is the opportunity to create efficiencies and reduce costs in the discovery of new drugs.

Indeed many of the world’s biggest stocks – mostly listed on Wall Street – are already making waves with AI-driven changes.

Bill Gates says whatever limitations AI has today will be gone before we know it.

Many of these companies are among the most traded offshore stocks among Australian investors. As you might expect, the tech titans are leading the race and most of the biggest names are now engaged in the AI race.

Google (Alphabet) has announced a partnership with the Bard AI venture, Microsoft has done a partnership with Open AI (the privately held group behind ChatGPT), while Facebook (Meta) is pushing into the space with initiatives such as the ESM Fold venture which is focused on AI-driven drug discovery.

But it’s not just the tech titans in the race. Computer chip company Nvidia has run ahead of rivals AMD and Intel, partly due to its leading role in AI.

Nvidia – which is the currently the fourth most traded offshore stock on CommSec – has more than doubled in price over the year to date.

Elsewhere, the Expedia travel stock has also sent ripples through the travel industry with an announcement this week where it partners with OpenAI to simplify travel planning for ChatGPT users.

Anyone can sign up to experience AI in action at openai.com. A chatbot is a digital program which can quickly produce content from text to images.

You can’t expect AI to get everything right as these are early days with the technology.

As Microsoft founder Bill Gates put it: “We should keep in mind that we’re only at the beginning of what AI can accomplish; whatever limitations it has today will be gone before we know it.”

Originally published as AI such as ChatGPT will create an early road map for investors