The study provides evidence of an 'AI divide' among investors, where those with AI capabilities have an information and trading advantage. It also highlights the potential of AI technologies in processing visual data from corporate presentations, which has been relatively unexplored. The researchers suggest that their work could serve as a framework for future studies on visual information in corporate disclosures.
Key takeaways:
- Artificial Intelligence (AI) technologies are increasingly being used to extract valuable information from visual data in corporate presentations, potentially creating disparities between market participants by rewarding AI-equipped investors with information and trading advantages.
- A comprehensive data set of corporate presentation slides was constructed and a deep learning algorithm was used to classify the images into three categories: Operations Forward, Operations Summary, and Others.
- Visual information, particularly 'Operations Forward' images, can predict stock returns and is associated with significant and positive short-term cumulative announcement returns. This information is also positively associated with firms’ sales and earnings in the future.
- AI-equipped financial institutions are more likely to trade on visual information, and stock prices incorporate such information more quickly when these institutions are present, suggesting an 'AI divide' among investors.