by: Grow VC Group
Download PDF
image_pdfimage_print

Markets always move toward greater efficiency, history has taught us that much. Technological advancements in computing power has been remarkable, but the growth and pace of development keeps on accelerating. Have you thought through the extent of the plausible impact of artificial intelligence (AI) and machine learning in the financial services market? Go ahead, try.

Cognitive psychology teaches us that humans are easily fallible as it comes to assessing the extent to which events are within their control. Humans also easily overestimate their own importance in the events that befall them and in turn underestimate the impact of factors beyond our control, such as timing, the environment and sheer luck. Are we over estimating our importance in financial markets? Without a doubt.

Financial services by volume has several interesting occupations, least of which is trading. However, if you look at the complex, though logical and information rich environment,s what exactly is defensible for us humans that we can actually hold on to? Are we of the opinion that a human is required to execute a complex hedging strategy? Are we wrong, and if so by how wide a margin?

AI and machine learning are still in early phase, but the practical implications with modern processing power continuously increasing is phenomenal and unprecedented. In raising these points in conversations with more traditional firms in financial services or market participants, a common dismissal is “We’ve been using the basics, a phone and a relationship for decades. It worked then, it works now” and debunks such as “I’m too old for those things”. Not only do these represent demeaning way of looking at some of the most promising technological advancements, arguably they represent a deep misunderstanding of just how fundamental this change in landscape is.

None of the current market applications in digital finance make use of real AI, despite what hype around robo advisor services may imply. But in the next wave of applications, we are going to be seeing new models unfold that will dwarf our imagination and displace tens of thousands of professionals into new capacities and capabilities. Like all change it will be uncomfortable and fought against, but try arguing the contrary point. Can you justify all the roles humans play in financial markets? Why are we relevant?

Read the whole article at Crowd Valley News.

AI fintech

Photo: Wikipedia.


Learn More About Grow VC Group Companies

Crowd Valley, Startup Commons, Kapipal, Grow Advisors, TradeUp Fund, Deal Index, Crowdcitee, p2p Safety, Crowd Index Fund, Commoditarian

Join Our Team

We are always looking for talented, entrepreneurial and driven doers to join our growing global group of companies in various positions and locations around the world. If you think you have what it takes, apply now!


Other posts you may enjoy

About the author

Grow VC Group The Grow VC Group is the world leading, global pioneer of securities crowd funding, peer to peer marketplaces, new investment models and global business development. Established in 2009, the Group has developed new investment models on six continents and continues to innovate the global market.

Tags: , , , , ,

This entry was posted on Tuesday, May 24th, 2016 at 10:00 am and is filed under Business Updates. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.