The model of the automated control system will be able to make decisions in stock trading
Deloitte experts estimate that in the next 7 years the volume of assets managed by automated systems will exceed $ 5 trillion. This is not surprising. Considering how quickly artificial intelligence is integrated into the financial industry, the probability that the forecast will come true is quite high. Models of automated control systems are increasingly being introduced into stock trading.
Researchers of Greenwich Associates and Thomson Reuters prepared a report on the future of investment companies. Studies have shown that more than 50% of companies specializing in asset management are ready to trust artificial intelligence and already look for opportunities to integrate automated systems.
The survey was attended by 30 respondents holding positions of heads of investment companies. 17% of respondents already use tools based on artificial intelligence, and another 10% integrate them during 2019.
The number of hedge funds that have entrusted the adoption of responsible decisions to automated systems is also increasing. These companies are also called quantum. Artificial intelligence makes certain decisions based on various mathematical models. According to researchers Hedge Fund Research, by the end of 2017 the amount of assets under the control of quantum funds almost reached $ 1 trillion. This is 86% more than in the same period of 2010.
World-famous banks are also interested in automated control technologies. For example, Credit Suisse already has two quantum funds – QT Fund and Qube Research and Technologies. The latter was allocated $1 billion dollars for management this year.
Also worth noting is the experience of JPMorgan Bank. In May, the organization started a special unit responsible for the integration of artificial intelligence. Now the Department is working on the development of a robot trader which will work on the stock exchange. The created version of the robot is not yet independent, it serves only as an assistant to human. However, it is expected that at the beginning of 2019 the bot will be able to make independent decisions.
Whether the model of the automated control system has defects
Wide use of artificial intelligence in stock trading and hedge funds has been postponed due to the presence of a large number of risks. First of all, we are talking about the fact that too little time has passed since the beginning of more or less active integration of bots, and there was not a single serious crisis.
The creator and head of the hedge fund SCT Capital Management Vazant Dhar believes that artificial intelligence does not yet have enough flexibility in decision-making. Unlike human, the machine only targets certain data that is loaded into its database. However, the automated system is not yet able to predict the crisis. Dhar points out that even people are often wrong in predicting.