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.

Wild guess, but I think trading activity goes down. AI focuses instead on which equity issuances to participate in.