Asset managers and stock exchanges are shifting to the use of artificial intelligence (AI) to speed up the analysis of large volumes of data and generate reports for investors and clients.
Schroders Capital is the latest company to join the AI bandwagon. Today it unveiled the Generative AI Investment Analyst (GAiiA) platform, designed for analyzing data and generating analyst reports on private equity.
In public markets, an established generative AI (GenAI) provider for institutional clients will launch an AI-driven platform for analyzing global exchange-traded funds (ETFs) and mutual funds.
Also, in November last year, JPX Market Innovation & Research, Inc. (JPXI), the research unit of Japan Exchange, launched a generative AI platform designed to provide multi-language reports on the 3,500 companies listed on the exchange. The platform aims to make information about these companies available to global investors. Previously, these reports were only available in Japanese, restricting access for non-Japanese-speaking investors.
In the case of Schroders Capital, the GAiiA is a proprietary platform for internal use only that “harnesses the technical expertise of its data science specialists alongside the deep investment knowledge of its PE team”, according to a statement.
On the other hand, JPXI uses the proprietary GenAI technology of Bridgewise, an Israeli-founded tech company, to analyze all stocks, analyze their financial performance, and generate analysis for each stock.
The difference is that the JPXI-Bridgewise platform uses a business-to-business and business-to-consumer model while Schroders’ GAiiA is for internal use only.
Democratizing information
In any case, the trend is clear that asset managers are using AI, and exchanges are jumping on the AI bandwagon to manage data, analyze information, and generate reports for their analysts and investors.
In an interview with The Asset, Kelvin Phua, Bridgewise’s Asia-Pacific general manager, stresses that the company’s GenAI platform is not intended to replace human analysts but to enhance their productivity.
“We want to find a way to democratize information, to enable investors, whether they are retail or institutional, to be able to get the information they need because obviously those professionals, they will have that ability and the knowledge and the skill to really look at all these reports really quickly,” Phua says.
Not all AI platforms are the same. Bridgewise’s platform, which claims to cover every listed company in the world, has two technology stacks. The first is an AI engine that gathers financial reports from companies and other data sources, crunches the numbers from these reports, and creates a scoring system that is used for generating the company’s analyst reports. The second technology stack is a language model that uses 12 major languages for generating the reports.
“To be clear, it's not a translation. We don't do a report in English, throw it to Google Translate, and it comes out in another language,” Phua says. “This is a proprietary language model, which [we designed] ourselves, it’s in-house, and the way we manage it, in terms of making sure that it doesn't hallucinate, is that we limit and control it to a very narrow set of information because it is not intended to be like a ChatGPT, for example, where you can ask about the weather and all that. It’s only intended purpose is to be able to respond and write reports in a financial setting.”
Bridgewise’s AI platform currently has 36,000 companies from all over the world.
When it comes to the risks of using AI, Phua says Bridgewise uses a highly sophisticated system that ensures all levels of the process are checked and counter-checked to prevent errors and mistakes.
