Intelligent Alpha is a $30 million investment fund where artificial intelligence (AI) completely takes on the role of making investment decisions. The company, founded and run by Doug Clinton, uses a trio of AI – ChatGPT (OpenAI), Gemini (Google), and Claude (Anthropic) – as an investment committee to build and oversee portfolios.
AI at Intelligent Alpha has made successful investment decisions, such as shorting Boeing stock before the 737 MAX incident. Although focused on traditional finance, the company has started experimenting with Bitcoin over the past year, predicting that under favorable conditions, the value of Bitcoin could reach $140,000.
"In the case of a price increase – Trump's victory and a more favorable legal environment – AI has assessed that the price of Bitcoin could reach $140,000. Perhaps that is the scenario we are heading towards right now."
The fund's investment process is quite simple: first, AI gathers data on large companies and creates a portfolio based on the philosophies of renowned investors like Warren Buffett and Stanley Druckenmiller. Then, humans review AI's decisions to ensure reasonableness and avoid errors. AI not only selects stocks but also explains the rationale behind each decision, helping to ensure that investments align with the fund's long-term goals.
Although it is common for AIs to disagree with each other, these differences help create a balanced and risk-averse portfolio. One of the standout successes is that AI selected Nvidia in the summer of 2023, and this stock has increased by about 400% since being chosen.
The Intelligent Livermore ETF, launched in September, is a product developed from Intelligent Alpha's AI strategy, using AI to build a global stock portfolio based on forecasts of macro events and areas of opportunity.
Although AI has not focused much on cryptocurrency due to a lack of data and difficulties in building investment strategies based on public information from platforms like X, Clinton stated that they are exploring the possibility of using AI to detect potential cryptocurrency projects in the future.
