Using artificial intelligence (AI) for investment decisions is no longer the exclusive domain of ‘quant’ funds. Here’s how asset managers, financial advisers and hedge funds are adopting the technology.
Cardiff-based technology firm Amplyfi is attacking this space. Amplyfi’s technology is used to find, analyse and discover weak signals and ‘unknown-unknowns’, correlations, trends and patterns that influence a market or investment. It enables new input metrics to be created for asset managers’ forecasting models that are often limited.
Amplyfi conducted a study to try to improve inflation (CPI) forecasting. A correlation – strong enough to warrant inclusion in forecasting models – was found between CPI and perceptions of water and wastewater mismanagement in the mining industry. These perceptions were driving increased government regulation that, in turn, increased costs for mines, downstream industries and, ultimately, the price of goods used to calculate CPI. Perception, tracked by previously ‘unmeasurable’ metrics such as the volume and content of newspaper articles in a local area, became forecasting model inputs.
Originally by Paul Bryant for The Review (cisi.org), read the full article here