AI in action · Investor protection
The EU's Checklist Before You Trust an AI Investing Tool or 'AI Stock Signals' App
Public chatbots aren't authorised to give investment advice, and apps selling AI stock signals can't predict prices. Europe's securities regulator has published a short list of what to check — and AI-powered scams are making it more urgent.
Ask a general-purpose chatbot what to invest in and it will often answer with confidence, sometimes after asking about your goals and risk tolerance. The European Securities and Markets Authority (ESMA) has published an investor warning, "Using Artificial Intelligence for Investing: What you should consider", that explains why that confidence should not be mistaken for advice.
Public online AI tools, it says, "are not authorised nor supervised by financial regulators" and have no obligation to act in your best interest. They are not designed to give investment advice, they "often work in ways that even their developers do not fully understand", and if something goes wrong you may have no access to an ombudsman or a complaints scheme. Their answers can be based on outdated, incorrect or incomplete information.
The warning singles out a fast-growing category: websites and apps that sell "AI stock signals" or stock picks for monthly or yearly fees. ESMA reminds investors that predicting price movements is "extremely difficult, if not impossible", and advises them to be wary of any service that claims to predict prices with high accuracy.
AI is also changing what fraud looks like. In December 2025 the three European supervisory authorities — EBA, EIOPA and ESMA — published factsheets warning that AI makes scams "more convincing and harder to detect", including AI-generated voices or videos impersonating friends or family. Their advice: never share personal or banking details, verify the source of any message, and pause before acting.
Put together, ESMA's guidance comes down to five habits:
Use AI tools as one source among several, not the only one. Be sceptical of promised high returns from AI strategies. Remember that a public tool has no duty to act in your interest. Check the information it gives you, because it may be wrong or out of date. And don't share personal or financial details with it.
The same logic applies to any published trade idea, including the theoretical setups on this site: an idea is only useful if it states what would prove it wrong, and its past results are public.
Sources: ESMA — Using Artificial Intelligence for Investing: What you should consider (2025); ESMA — ESAs publish key tips to help consumers detect, prevent, and act on online frauds and scams (Dec 15, 2025)