AI now outperforms some of the best human forecasters
Artificial intelligence now beats some of the best human forecasters
A Hacker News discussion explores the implications of AI surpassing top human forecasters. Commenters propose an "AI-driven Market Hypothesis": since retail investors increasingly rely on mainstream LLMs, a model trained to predict those LLMs' investment decisions could gain an edge. Others suggest applying the same logic to scientific or policy trends, where LLM-driven decisions may make outcomes more predictable.
Then the next person needs an LLM trained to predict the LLM trained to predict the mainline LLM. It's derivatives all the way down
- glimshe
Product idea: a LLM trained separately from mainline LLMs that anticipate market trends by analyzing how mainline LLMs will invest. As retail investors will probably use mainline AI for decisions going forward , one could get an edge.
"The AI-driven Market Hypothesis"
Please let me know where I should pick up my Nobel prize.
- phyzix5761
Stock analysts have a success rate of 47% or lower for directional predictions. That's worse than a coin flip. All AI has to do is product fair 50/50 results and it can beat analysts. But you can do it too for the price of a quarter.
- avipars
- gertlabs
We measure skill differentiation between frontier / last-gen LLMs across our environments, and one of our curated coding environments is a closed-system market simulator, containing only other agents and some system participants (a market maker and a liquidity provider via issuance / buybacks) whose behavior is fully defined for all of the agents.
This has the least measured skill differentiation of all of our environments, and not because forecasting/markets don't require skill or intelligence. Even the best models are so far from anticipating the behavior of the other agents and understanding the emergent effects that a 2025 model with a naive strategy can often outperform over the timeframes of the simulation simply because some other models in the simulation chose a similar self-reinforcing strategy. This likely happens to some degree in real markets.
You can watch these simulations here https://gertlabs.com/spectate?game=market
- bagels
Aren't forecasters already using 'artificial intelligence' for decades in the form of non-llm machine learning models?
- seanhunter
This has to be the least surprising development to date given ml is a universal function estimator
- jesse_dot_id
It will be interesting to see if this changes because presumably AI is using very predictable historical models, but it seems like the climate is shifting into something unseen that we won't have models for?
- qsbuilder
The test is when reflexivity kicks in and the prediction itself changes market behavior. LLMs usually melt there