Babak Hodjat is managing a hedge fund in San Francisco run completely by artificial intelligence (AI); his firm Sentient Technologies Inc. has been building an AI system for analyzing markets and automating trading for over a decade; performance for the firm is not publicly disclosed; numerous firm's in the wealth management industry are using some form of unbiased automated trading however Sentient is one of few firms that completely uses AI technology for comprehensively managing assets. Source
CNBC profiles three companies emerging in the banking industry with solutions built from machine learning technology; Digit has created a solution that integrates with a user's bank account to automate savings based on account balances and spending patterns; Zest Finance is offering credit scoring technology based on AI algorithms using alternative credit data; Adyen is also using machine learning for fraud prevention; overall machine learning solutions are evolving rapidly and speculators believe they will revolutionize the workforce; Goldman Sachs says machine learning and AI will enable $34 billion to $43 billion in annual cost savings and new revenue opportunities for the financial sector by 2025; it's also expected that AI and machine learning will begin to replace jobs that can be easily automated while also creating greater opportunities for software developers and data scientists. Source
Cambridge, Massachusetts-based artificial intelligence (AI) platform Kensho has built a solution that can successfully predict market trading and is receiving significant attention from Wall Street; its AI-powered platform helped the company identify currency trends following Brexit that resulted in substantial gains from trades against the British pounds decreasing value; the company has announced a new partnership with S&P Global and has received investment from Goldman Sachs, JPMorgan Chase, Bank of America Merrill Lynch, Morgan Stanley, Citigroup, Wells Fargo, General Catalyst, Breyer Capital and Google Ventures; the firm is led by Daniel Nadler, a Harvard trained Ph.D; its new partnership with S&P Global Market Intelligence will supply new data feeds to power its AI analysis and support its numerous solutions including the Kensho Global Event Database and Kensho's Knowledge Graph; the business is expected to become integrated with Wall Street's mainstream banks, emerging as one of the market's leading solutions for AI-powered trading. Source
As the global leader in cognitive solutions, IBM's Watson is one of the top artificial intelligence offerings for financial services companies; Brian Walter is IBM's Global Leader of Watson Client Insights and Cognitive Experience for the company's Watson Financial Services Solutions group; Brian Walter gave a keynote speech on Tuesday at LendIt USA and also talked with Forbes about how artificial intelligence is changing the financial world; in his interview with Forbes he discusses the use of cognitive solutions for financial services compliance, customer service and customer acquisition; also talks about IBM's cognitive solutions for supporting banks, fintechs and developers. Source
Baidu is active in artificial intelligence (AI) development and could provide an investment channel for investors seeking to gain from the innovative technology; the company is integrating AI into nearly all aspects of its business and in September launched artificial intelligence platform "Baidu Brain" which integrates AI in search, news feeds, maps, Nuomi and PostBar; the firm is also evolving AI for healthcare and actively developing autonomous driving solutions powered by AI; overall, its business model can easily integrate AI while it also provides products for AI entrance in other markets. Source
In an article from American Banker, the pros and cons of AI-based credit scores are outlined; pros include more precise scores through more nuanced evaluations of data and the ability to consider consumers that linear models would reject; the cons are the risk that regulators will consider an AI-based score a "black box" and being able to provide one clear reason for credit denial; perspectives from Elevate, ID Analytics, Experian and FICO on AI credit scoring are presented in the article. Source
A 2015 McKinsey report says today's technology is ready to replace approximately 45% of US jobs across a wide range of industries; federal and state governments have been receiving numerous inquiries about the effects of robot automation on the labor market however little has been done by legislators on the topic; Bill Gates has one suggestion for the economy; he suggests a tax for robot automation; a number of scenarios have come from Gates' robot tax suggestions, including: a company tax for robot automation that would contribute to social programs, designating government funds for salaried workers affected by robots, using taxes to provide a universal income for all citizens and a negative income tax. Source
Lantern Credit has acquired the Abstract Regression Classification (ARC) Machine Learning Library to enhance its proprietary machine learning solution, Beam AI; the firm expects the acquisition and machine learning enhancements to improve its credit advice, credit offers and support for financial institutions; according to Chad Swensen, CEO of Lantern Credit, "Leveraging the ARC software to advance the Beam AI technology produces the most advanced artificial intelligence and machine learning application in the consumer credit management space." Source
Google's artificial intelligence unit, DeepMind, is using blockchain technology to build an auditing system for analyzing and storing healthcare data; the system will mainly focus on tracking all of a person's hospital health data and centrally storing it for access and ownership by individuals; DeepMind will also make its system available through open source software allowing for the technology to be utilized for broader solutions including auditing identities, financial records and private corporate data. Source
At IBM's InterConnect conference this week in Las Vegas the company discussed its plans for cloud, artificial intelligence and blockchain, three areas that it will be increasingly focusing on for the future; the IBM Cloud will be the base of the growth strategy with artificial intelligence and blockchain driving a full range of capabilities. Source