Artificial intelligence (AI) is rapidly transforming modern finance, powering applications ranging from stock market forecasting to investment advice. But does making more accurate predictions necessarily lead to better investment decisions? According to two recent studies by researchers from Pusan National University and international collaborators, the answer may be no.

Just as a weather app may predict tomorrow’s temperature accurately but still tell you to leave your umbrella at home before a storm, a financial AI system can make highly accurate market forecasts yet still make poor investment decisions. The researchers argue that AI should be judged not only by how well it predicts markets but also by how effectively it supports real-world financial decisions.