Part 37 of 43 in How to Invest Your Money: Lessons from the World’s Greatest Investors, Adapted for the Indian Investor← Part 36Part 38 →
This appendix provides sample prompts for using AI in investment research and planning. It helps Indian investors examine companies, risks, capital allocation, investment concepts, market history, portfolios, and investment policies while verifying AI outputs.
- Adapt these prompts to specific companies, funds, or situations, and always verify the outputs.
- Use annual reports to examine business models, revenue drivers, costs, risks, and changes from the prior year.
- Compare five years of capital allocation across reinvestment, dividends, buybacks, and acquisitions.
- Test an investment thesis with counter-arguments, relevant data, and developments that could undermine it.
- Use prompts to study concepts, Indian market episodes, portfolio risks, and investment policy statements.
The following prompts are starting points. Adapt them to specific companies, funds, or situations. Always verify outputs.
1. “Summarize the business model, revenue drivers, and cost structure of [Company] based on its latest annual report. Highlight any significant changes from the prior year.”
2. “List the key risks disclosed by management in the latest annual report of [Company]. Categorize them as business, financial, regulatory, or other. Note which risks appear new or more prominent.”
3. “Compare the capital allocation decisions of [Company] over the past five years. How much was reinvested, paid as dividends, used for buybacks, or spent on acquisitions? What does this suggest about management priorities?”
4. “I believe [thesis]. Provide the strongest counter-arguments and the data or developments that would most undermine this view.”
5. “Explain [concept such as free cash flow, ROCE, or working capital cycle] using a simple example from an Indian listed company. Then give me two practice questions.”
6. “What historical episodes in Indian markets are most relevant to understanding the current environment in [sector]? Summarize the outcomes for long-term investors who held through the period.”
7. “Given a portfolio of [high-level description], what concentration or correlation risks should I examine? What questions should I research?”
8. “Draft a one-page investment policy statement for a [age]-year-old Indian investor with a [horizon]-year goal, moderate risk tolerance, and primarily salaried income. Include allocation ranges and review rules.”
Frequently asked questions
How can AI help analyze a company's annual report?
It can summarize the business model, revenue drivers, cost structure, and significant changes from the prior year. It can also list and categorize risks disclosed by management.
How can I use AI to test an investment thesis?
Ask for the strongest counter-arguments and for the data or developments that would most undermine the thesis.
What can AI explain about an investment portfolio?
For a high-level portfolio description, AI can identify concentration or correlation risks and suggest questions to research.
Can AI draft an investment policy statement?
Yes. A prompt can request a one-page policy statement for an Indian investor using age, goal horizon, moderate risk tolerance, salaried income, allocation ranges, and review rules.