Date
13 December 2017
Artificial Intelligence is widely expected to bring huge efficiency benefits to many industries from retailing to financial services. Photo: Reuters
Artificial Intelligence is widely expected to bring huge efficiency benefits to many industries from retailing to financial services. Photo: Reuters

AI sees promising application prospects

The artificial intelligence (AI) sector attracted US$30 billion in investments worldwide last year. China alone spent US$8 billion in the AI space. The staggering figures highlighted the rapid growth of the data industry and value recognition of big data and AI. It’s widely expected that AI will bring  huge efficiency benefits to many industries.

For instance, big data can be utilized in retail not only for predicting and analyzing sales. In one day, a smart retailer may send a product to your home, and you can even make payment after a trial.

Financial services also offer great potential to utilize AI. Over the past few years. AI has been used to identify customers, observe customer demand, customize operation in order to optimize resources management and improve service efficiency and risk management.

Making money is essential in the fintech world. The AI-powered equity ETF was launched recently, and it uses the big-data processing abilities of IBM’s computer system Watson to develop a portfolio of stocks to find investments it perceives as undervalued.

The fund’s software would constantly analyze information on about 6,000 US-listed stocks, scanning through regulatory filings, news articles, social media posts, and traditional financial metrics.

AI is also marching into fixed-income funds and helping to make decisions in bond trading. The key is to obtain a positive return on the bond market. AI is gaining popularity in quantitative trading or even in assisting individual investors.

I personally believe that the source of financial service reform is shifting user habits. For example, when everyone is used to online shopping, who will want to wait for 30 minutes in the queue at banks? Some banks have set HK$1 million as the minimum loan amount for micro firms, while many new financial institutions are flooding into real microloans.

Big data and AI would open up new opportunities by reading the human mind. Traditional companies should embrace these new technologies as fast as they can.

This article appeared in the Hong Kong Economic Journal on Nov. 21

Translation by Julia Zhu

[Chinese version 中文版]

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BN/RA

Venture Partner of Sequoia Capital China, former head of the data committee and vice president at Alibaba Group.

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