I think what will happen is that ordinary people will invest in a mutual fund managed by AI and/or the funds people already invest in will start adopting AI-tooling.

I think this scenario is plausible because the path to this scenario is so smooth so it will be the default outcome unless something strange happens to prevent it.

I'm wondering what a market looks like where everyone is running an AI that makes the optimal purchases. The market needs bag holders.

I also don't know that it would change my behaviour. If my goal is long term investment success what's the downside of my continuing to invest in broad market funds? I don't need an AI making split second decisions if my investment horizon is still 30 years.