Can AI replace stock analysts? Yes, it can

 

The recent study "Can AI Replace Stock Analysts? evidence from Deep Learning Financial Statements" shows that an atheoretical neural network approach using financial statement information, stock prices, and interest rates can do as well or better that the predictions of stock analysts. Given a lot of information and without making any assumptions on how to use the information, the NN approach can beat the analysts. 

However, the story is a little more complex than just letting the computer do its work. When the analysts compete against the NN model which only uses fundamental company information, the results are in favor of the analysts. When the NN is able to use both interest rate and stock price information, it does much better. 

The AI model is able to capture the combination of stock fundamentals with some macro information and price behavior. The value-added comes when the computer is able to blend all these features together.