Artificial intelligence (AI) and machine learning are making waves, profoundly changing financial markets.

AI and machine learning haven’t just boosted automation and efficiency, leading to impressive stock market gains over the last couple of years. They’re also opening up exciting new possibilities for practical application.

Now, automated trading systems aren’t exactly a fresh idea. Actually, a large chunk of market trades are already handled by algorithms. But these tools used to be mainly for big institutions and pros.

But here’s the exciting part: recent tech leaps are making these powerful tools accessible to more people. Take the GPT Portfolio, for instance. It’s a community project collaborating with Dr. Alejandro Lopez-Lira, a finance professor from the University of Florida and the author of ‘The Predictive Edge’ – a book all about using AI like ChatGPT for financial predictions. Using the Autopilot copy-trading platform, this portfolio is now managing a cool $37.9 million!

According to the project’s White Paper, the GPT Portfolio puts its money into 15 assets: 10 individual stocks and 5 ETFs that focus on specific sectors. They hold these for about a month, and then their AI system kicks in, analyzes everything, and decides on any rebalancing.

Back on March 11th, the portfolio was rebalanced. This time, with all the economic uncertainty in the air, ChatGPT went for a more defensive approach, picking three “safe haven” stocks.

Buffett, blue chip healthcare, and consumer staples — ChatGPT’s safe haven stocks

First up on ChatGPT’s list was Berkshire Hathaway (NYSE: BRK.B). This giant company, run by Warren Buffett, is known for its solid financial management and consistent long-term growth. ChatGPT pointed out that Buffett’s huge cash pile and knack for smart investments during market dips give them a real advantage.

However, ChatGPT also noted the potential downsides for Berkshire, like a general economic slowdown and their significant holdings in insurance and energy sectors.

Next, ChatGPT chose Johnson & Johnson (NYSE: JNJ). This healthcare giant has a strong financial foundation, pays reliable dividends, and is considered a defensive play since people will always need healthcare, no matter the economy. It seems the AI picked JNJ to add some stability to the portfolio.

On the flip side, the AI also flagged that Johnson & Johnson’s moderate debt and slower earnings growth could hold it back, especially if interest rates stay high.

Lastly, ChatGPT added the Consumer Staples Select Sector SPDR Fund (NYSEARCA: XLP) to the portfolio. Since people still buy everyday household goods even during recessions, the AI likely picked XLP for its stability – low price swings and a consistent flow of revenue.

Okay, so how would these three safe haven picks have actually done if you invested equally in them at the beginning of the year? Well, the two individual stocks, BRK.B and JNJ, have jumped up by 9.37% and 12.63% so far this year (year-to-date or YTD).

On the other hand, XLP has grown at a much slower pace, sitting at a 1.64% gain during the same period.

Put it all together, and an equal investment in these three would have given you a 7.88% return since the start of the year. Just to compare, the S&P 500 benchmark index is actually down 4.78% in the same timeframe.

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