Step 3: Build or choose an AI model
For portfolio management, a reinforcement learning model might be most appropriate. The AI will learn and adapt its actions based on rewards or penalties. This allows the agent to optimize the portfolio over time by evaluating the performance of different assets and adjusting allocations accordingly.
What the model does: The AI learns from past portfolio performance and current market conditions to suggest the optimal mix of assets.
The AI will monitor market fluctuations, adjusting asset allocation by moving funds into stablecoins during high volatility or switching into high-yield opportunities when market conditions are favorable.