Meet AI, New Investment Management Assistant

Capital Markets CIO Outlook | Friday, June 19, 2020

Aiding both investors and investment management agencies, AI changes the game of managing investment and optimizing portfolios for good.

FREMONT, CA: The regularly fluctuating capital markets industry and the growing availability of the investment products for the present-day investors encourage the industry professionals to deploy AI-based applications across their operational infrastructure. The expanding market demands and transforming investment ways makes it high time for experts to develop tech-driven strategies for tackling market challenges. 

Today, it has become highly crucial for the investors to evaluate the investment products more precisely than ever to make an investment decision. The increasing complexity of the market situation and product value need to be understood accurately in order to avoid loss and gain high returns on investment. Some of the benefits offered by the AI technologies are listed below.

• Risk Mitigation

Artificial intelligence provides investment managers with predictive abilities, which help them frame a future picture of the market and develop strategies to tackle the market risks vigilantly. The investors need to evaluate the risk mitigation and regulatory profile of the investment management agencies before hiring them to handle or performing the investment on behalf of them. 

• Hedging Abilities

An ideal investment management agency needs to be an expert in hedging against the capital market volatility. AI-based prediction regarding high volatile stocks can help the investment management agencies avoid a massive loss to their clients by hedging the invested capital in the market. Accuracy in prediction helps in improving the clients’ portfolio by recognizing relevant trends and using the assets for investing in the market. 

• Portfolio Optimization

As the high-net-value investors expect high ROI from the investment management agencies, such expectation motivates the managers to use AI-based applications and maximize their institutions’ fund efficiency. AI-based investment management applications influence investment styles and strategies, making it highly data and prediction-based. Such an approach eliminates the chances of facing huge investment risks in the future and raises profit probability. 

In recent years, AI has transformed the capital market’s operational ways and promises to continue offering brilliant market-boosting strategies.

See also: Top Capital Markets Technology Solution Companies

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