The rise of AI in asset management

Artificial intelligence has been hailed as the next frontier in investing. Its application is already widespread in various forms but its true potential in portfolio management is still far from being fulfilled.

AI has come a long way since its first recorded uses back in the fifties, and the technology continues to evolve at an unprecedented rate. There have been various breakthroughs in recent times, autonomous driving is just one of many examples.

Its advancement has changed many aspects of our daily lives, from banking to online shopping – and it is changing the face of asset management as well.

There have been a number of AI developments in finance lately, including BlackRock’s launch of its own AI lab back in 2018. Investment banks and brokers have also claimed that AI helps them with execution strategies, and in operational areas as well.

Artificial intelligence and machine learning is also being applied in portfolio management, as developers create algorithms designed to navigate the world’s stock markets.

It’s a brave new world. Automation is constantly on the rise.

A 2017 report by Opimas LLC estimated that AI would result in around 230,000 job cuts in financial firms worldwide by 2025. Asset management would be the hardest hit area with around 90,000 job losses, the consultancy firm suggested.

But as this evolving technology becomes increasingly prevalent – there will always be a need for the human touch, The Lens has learned in conversations with experts.