Hedge funds embrace machine learning—up to a point

ARTIFICIAL intelligence (AI) has already changed some activities, including parts of finance like fraud prevention, but not yet fund management and stock-picking. That seems odd: machine learning, a subset of AI that excels at finding patterns and making predictions using reams of data, looks like an ideal tool for the business. Y

et well-established “quant” hedge funds in London or New York are often sniffy about its potential. In San Francisco, however, where machine learning is so much part of the furniture the term features unexplained on roadside billboards, a cluster of upstart hedge funds has sprung up in order to exploit these techniques.

These new hedgies are modest enough to concede some of their competitors’ points. Left to their own devices, machine-learning techniques are prone to “overfit”, ie, to finding peculiar patterns in the data.

Read more: Hedge funds embrace machine learning—up to a point

Don’t forget to share this via , , Google+, Pinterest, LinkedIn, Buffer, , Tumblr, Reddit, StumbleUpon and Delicious.

Mike Rawson

Mike Rawson has recently re-awoken a long-standing interest in robots and our automated future. He lives in London with a single android - a temperamental vacuum cleaner - but is looking forward to getting more cyborgs soon.

Leave a Reply

Your email address will not be published. Required fields are marked *

Hedge funds embrace machine learning—up to a point

by Mike Rawson time to read: 1 min
Hi there - can I help you with anything?
[Subscribe here]
 
More in Machine Learning, News, Work
GM self-driving car
My Herky-Jerky Ride in General Motors’ Ultra-Cautious Self Driving Car

NOTHING WILL MAKE you hate humans—capricious, volatile, unplanned, erratic humans—like sitting in the back of self-driving car.

Close