AI Eats Finance
Best of
@favoritetakes
−1.9%
since Sep 29
The idea
I believe prompt-based AI is about to reshape how investing gets done, and fast, within the next year or two. To play it, I own the companies whose data and ratings feed those AI models, the exchanges that own the raw market feeds, and the brokers and fintechs shipping AI features straight to customers, where I lean harder into the highest-beta names. I keep a cash reserve to add on dips rather than chasing, and I'd rethink this if the AI adoption curve in finance clearly stalls instead of accelerating.
What it owns
- Financial AI models depend on licensed data they cannot recreate, giving data owners pricing power as AI adoption accelerates. · S&P GlobalIt owns ratings and index data that AI investing tools must license, provided those tools keep buying rather than routing around it., MSCI Inc.It provides the indexes that AI tools reference and cannot skip, so the take holds if index licensing grows as AI products multiply., FactSet Research SystemsIt sells cleaned financial data that prompt-based tools need behind the scenes, so the take stays intact if AI products license its feeds rather than replacing them., Moody's CorporationIt holds credit ratings and history that AI cannot invent, so bond-focused AI models must license its data as adoption spreads., Thomson ReutersIt owns financial and legal text that trains AI and already sells AI products on top of it, so the take holds if that data keeps commanding prices., Verisk AnalyticsIt holds decades of insurance data that AI underwriting cannot recreate, so the take depends on insurers' AI adoption driving data demand., MorningstarIf retail investors start using prompts to invest, the research backing those answers looks like Morningstar data, so the take holds if AI tools license rather than replace it.33%
- Brokers shipping AI features to customers fastest stand to capture account growth as prompt-driven investing spreads. · Robinhood MarketsIt ships AI features to retail customers faster than competitors, so account and deposit growth tied to those features would validate the take., Interactive BrokersIt already operates as the most automated broker, positioning it as the natural home for prompt-driven trading as long as account growth and AI tooling stay strong., Coinbase GlobalIt is the trading rails that AI agents would use for crypto, the most automatable asset class, so the take depends on rising trading volume and AI integrations., Charles SchwabIt has the largest customer base to deploy AI features to, so even modest AI adoption moves meaningful account volume if it actually ships those features., Futu HoldingsIt built its app around software from the start and ships AI features to young Asian customers fast, so the take needs steady quarter-over-quarter account growth.32%
- Exchanges own proprietary price feeds that every trading AI must purchase, making data revenue grow with machine trading volume. · Intercontinental ExchangeIt owns proprietary exchange feeds that AI tools need to answer market questions, so rising data revenue as AI spreads supports the take., CME GroupIt owns the only source of futures and options data it operates, meaning AI models pricing derivatives have to pay for it as adoption grows., Nasdaq Inc.It owns proprietary market data and sells AI-powered tech to other exchanges and banks, so the take depends on both businesses growing together., Cboe Global MarketsIt controls proprietary options data including the VIX that financial AI tools require to answer questions about volatility.18%
- As bond and rates trading shifts from voice to electronic screens, AI speeds that transition while capturing the data it generates. · Tradeweb MarketsIt captures bond trading shifting from phones to screens, exactly the electronic plumbing AI needs to automate fixed income markets., MarketAxess HoldingsIt owns both an electronic bond market and the pricing data generated from it, positioning itself to benefit from dual revenue sources as bond trading automates.7%
- Cash10%