The year 2025 can be the one that will show where exactly the stock market stands as far as AI-led technology is concerned. As various industries now utilise AI for quite some time, the rise or fall in their fortunes could have a decisive impact on the future of AI. As of now, however, most financial experts think that the business for AI is ready for a boom, with the Magnificient 7 companies either undervalued or not showing any anomaly in their stock prices.
In this scenario, the current financial ambition of industries utilising AI is under the radar. From FinTech to the gaming industry, AI has been considered the key to growth by most companies. Therefore, AI demands your attention even if you do not immediately invest in it – a good investment needs superior market research, which cannot be conducted overnight. In this article, we will try to understand the degree of involvement that AI has in different industries and comment on the challenges it faces that need to be resolved.
Industries that AI is redefining
Before you invest in any company, you need to identify the industry and have an idea about its involvement with AI. The presence of AI has been so all-pervasive that even if you do not directly invest in it, it is likely to affect your income from stocks indirectly. Let us take a look at the industries that utilise AI.
MarTech
Martech, or the marketing technology industry is revamping itself by discarding the traditional modes of traffic engagement for increasingly AI-driven methods. Earlier on, the markers of viewership engagement were rudimentary, like clicks and conversions. However, AI has brought forth the era of neuromarketing and behavioural research that is essentially more effective than the method it replaces. Thanks to AI, affiliate marketing is now way more transparent and exceedingly more efficacy-oriented. Chiefmartec claims that from 2011 till last year, MarTech has seen a growth rate of over 28%, which is an impressive premise for investment.
iGaming
According to Grand View Research, the online gaming (gambling) industry is all set to be valued at over 10,41 lakh crore rupees by 2027, which would mean a compound annual growth rate of above 11% since the 2020s. In these times of pin-up investments, the idea behind running a successful business model has seen a paradigm shift. Budding entrepreneurs and AI-tech companies now do not just look for capital but the expertise, connection and international tie-ups that are required for a clear shot at success. Therefore, it is hard to fail as an industry with so much focus on success. The iGaming industry might also be a good place to invest because of the growth rate it is experiencing at the moment.
FinTech
Among all the industries that now involve AI in its internal processes, FinTech is probably the frontrunner. The best part about AI involvement in this sector is that it helps in laying firm ground for this fumbling industry. The major FinTech industries have suffered a lack of growth in the past years owing to the pandemic and market reasons beyond their control. However, AI has helped them in the following areas:
- Risk management: With AI, it is now easier to assess the risk involved in a particular transaction. Furthermore, the creditworthiness of individuals is calculated with an accuracy never seen before.
- Niche market identification: With big data helping it conduct meticulous market research, AI helps the FinTech sector find new markets to operate in. Therefore, it has a direct involvement in the growth of this industry.
- Growing demand: The financial landscape has seen a sea change in recent years, with cryptocurrency making waves and coming up[ as a volatile but highly profitable investment. With AI algorithms, the dynamic nature of the stock market can be somewhat tamed, thus giving investors a reason to smile.
F-Prime Capital maintains that the FinTech industry has recovered from the initial blows and reached a total capitalisation of about 43 lakh crore rupees. Thus, financial corporations and NBFCs have found in AI the new mantra for growth.
Risks and challenges
The risks and challenges to AI investment are not many but must be considered to form your strategies with more technical elan. Since these AI-led industries will be present in the online marketplace, the margin of error is negligible. Even the slightest bias pertaining to race, gender, socioeconomic status or religion will not be perceived well by the market as a reaction to public outrage. Furthermore, privacy concerns are persistent with AI as they deal with big data and might be found breaching user privacy, causing legal trouble. However, AI developers are seriously concerned with these issues since they are so fundamental in nature. Finally, the financial landscape for AI investment looks green enough with some rough patches, which can be dealt with, the outcome being hopefully favourable in the future.
