“Software is eating the world, and AI is eating software.”
This saying could not be truer, especially in modern times, as Artificial Intelligence governs everything we do from search to virtual assistance. It is futile to think that these advanced technologies will take over our world – they have already taken over, and there is no escaping them.
The world is moving forward at an unprecedented rate. The world of technology improves at the speed of light every single day, and Artificial Intelligence is at the leading helms of this revolution.
When we hear the term AI or Artificial Intelligence, we think of something magical inside a black box – something that we just cannot seem to know how it works. AI is just statistics (understatement of the year). AI is much more than just that; AI uses highly complex statistical models that are fine-tuned for accurate prediction thanks to new sub-fields called Machine Learning and Deep Learning.
Here are five ways that AI is supercharging investment:
1. Better Predictions, Lightning Decisions
The immediate glaring benefit of artificial intelligence is that it will always lead to better predictions; quick acquisition of relevant data to make decisions at the speed of light. As AI becomes more and more invisible, companies willingly adopt and trust these technologies almost to blind faith. Nowadays, when we chat with a company representative on their website or through email, or even through phone, it is highly likely that we are communicating with an AI bot.
2. No Emotional Bias
Regardless of experience, humans are not free from their emotions and make irrational decisions while investing due to falling into their own emotional biases. AI removes the doubt that we can be affected and objectively decides what to invest in based on data, proven track record, and careful calculations through intricate and complex statistical and machine learning models. That isn’t to say that AI models cannot be influenced by bias; however, bias is driven by data and the algorithms rather than a sentient being that has a shift in its decisiveness. The other great part is that this bias can be removed if the one designing or implementing a model factor in the bias to correct the algorithm.
3. Risk-Reward
Investing is already a risky game. New players and veterans alike need assistance from artificial intelligence to alleviate the associated risk of treading into unpredictable lands. Investing is no different, with an active involvement needed to reduce risk and maximize reward as much as possible.
4. Driving Down Costs
We cannot hide the fact that newer technologies replace archaic ways. These ways are slower and more costly, which is why newer technologies show just how much more efficient they can be at the job. Henry Ford once said that people would ask for faster cars, and it was none other than the engine that showed that you don’t know what was missing until a technology comes. In the same way, we don’t have to deal with the high maintenance costs of a horse and slower speed (relative to motor vehicles). We are unaware of the leaps and bounds good AI has made.
AI reduces costs in areas such as automating menial routines like data collection and data cleaning to make it usable all the way to more complex tasks such as market trends, predicting investing opportunities, preparing strategies, and so forth. It also pays back in terms of labor costs such as advisory fees and the lack of around-the-clock availability.
5. Talk To Invest
Thanks to modern technologies like Amazon’s Alexa, we can easily communicate with AI through just our voices. The easiest form of communication is a simple vocal conversation. Many investors will make better decisions if they do not have to deal with the friction of using a computer or phone and simply focus on investing. It is much easier to think of a decision to make, and then instead of jumping hoops to execute those decisions, Investors can now simply talk to chatbots and invest based CFD brokers like InteractiveBrokers have support to be used with Amazon Alexa through their IBKR IBot Skill that can be added and used with simple voice commands.
Conclusion
The world is moving forward at an unprecedented rate. The world of technology improves at the speed of light every single day, and Artificial Intelligence is at the leading helms of this revolution. Trading and investing are such fields that have heavily profited with the advent of such fast-paced technologies resulting in driving their innovation even further. AI has helped automate redundant and uninteresting tasks all the way to making extremely tricky and difficult decisions a breeze to manage. With further development, a million dollars could just be just a thought away.
