The Future of Investing? AI-Run Hedge Funds

This AI could predict market trends better than a whole team of experts.

11. 21. 16 by Jess Vilvestre
Image by Dreamstime

Reading Financial Data With AI

Artificial intelligence, previously just a sci-fi fantasy, is now here and outsmarting us all.

Aidyia, a Hong Kong-based investment company uses an advanced AI program to read trends in trade, and execute them by itself. Human users just need to set certain parameters and modify the system as needed, but the hedge fund is practically run by the system, and it’s quite successfully. Aidyia’s chief scientist Ben Goertzel daringly says, “If we all die, it would keep trading.”

After analyzing market prices, macroeconomic data, and corporate accounting documents, the AI engines make daily predictions about the economy and then “vote” on the best course of action. Each engine is different – one is inspired by genetic evolution while another is based on probabilistic logic.

Many hedge funds have been using advanced algorithmic processes for years now, but with the emergence of deep machine learning and AI, companies have been looking further into higher-level analysis and autonomous computer operations. Apart from trends in numbers, this tech can analyze more unstructured data like news articles, company reports, and social media posts, enabling them to gather broader insight.



AI Future

Other investment companies focusing on AI-driven operations include Sentient in San Francisco, and Rebellion Research in New York. But financial data isn’t the only thing artificial intelligence has taken over—as a matter of fact, it’s only the start.

Already, vehicles are using AI in self-driving cars that make road navigation safer and easier. AI is making waves in medicine, performing breast cancer mammograms with 99 percent accuracy. An AI-powered wearable headpiece is even letting the blind see.

Because AI performs work in perfect repetition and reliability, there’s a lot of emerging studies foreseeing that the labor force will be largely replaced by cognitive technology. But takeover won’t just be for blue-collar jobs where automatons take over finicky, repetitive work. AI could take over the jobs of human experts like doctors, lawyers, and finance experts, or at least partner alongside these professionals, just like it is doing at Aidyia.

What could this mean for us humans? At this point, academic discussion and study are ever imperative to ensure AI is used to benefit all.


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