AI Can Replace Mutual Fund Managers, Harvard Study Shows

Entrepreneur

by Jonathan Small

February 26, 2026

AI-Generated Deep Dive Summary

Harvard researchers have revealed that artificial intelligence (AI) can predict 71% of mutual fund managers' trades with remarkable accuracy, potentially reshaping the $54 trillion asset management industry. This groundbreaking study, spanning from 1990 to 2023 and published by the National Bureau of Economic Research, highlights the growing role of automation in finance. The findings suggest that thousands of high-paying jobs in trading and fund management could be at risk of replacement by AI systems, which can replicate human decision-making with stunning precision. The study identifies senior managers in less competitive sectors as the most predictable—and therefore the most vulnerable to automation. However, it also notes that human intuition remains valuable in scenarios where managers have significant personal investments in their funds. These individuals are harder for AI to mimic, emphasizing the importance of "skin in the game" for preserving human decision-making in finance. For startups and entrepreneurs, this shift presents both challenges and opportunities. While automation could disrupt traditional job markets, it also opens doors for innovative businesses focused on developing AI-driven financial tools. Startups that can harness machine learning effectively may gain a competitive edge, offering cost-efficient solutions to investors while potentially displacing outdated practices in the finance sector. Ultimately, this study underscores the transformative potential of AI in reshaping industries and creating new opportunities for innovation. As technology continues to advance, businesses must adapt by leveraging AI not just as a tool for automation but also as a driver of growth and efficiency. The implications for startups are clear: embrace AI or risk falling behind in an increasingly competitive landscape.

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Originally published on Entrepreneur on 2/26/2026