First fund fully managed by AI to be launched

German investment firms Acatis Investment and BayernInvest have partnered the BayernInvest Acatis KI Aktien Global Fonds, which is said to be the first fund entirely controlled by artificial intelligence (AI).

The new fund is set to launch on 23 March with stock selection, weighting and reorganisation activities relying on the AI systems deep learning models. As a result, the fund manager no longer intervenes in the portfolio decision-making process, according to Acatis.

The German manager said the self-learning model progressively adjusts to the market environment and targets a long-term horizon.

Acatis assesses deep learning that, it claims, can be compared to a good analyst with years of experience.

“During the course of his career, he got to know a lot of companies and gained insight into them, Acarius said. “As time progressed, he developed a knack for detecting patterns in companies’ figures and balance sheets. Over time, he learned what features are important. His experience helps him to quickly and better contextualise new situations.

Independent learning 

“Deep learning models work in a similar fashion. They learn to independently detect patterns in balance sheets, which they then apply to new data. The more data that is available to the system, the better it can learn and gain ‘experience’. At the same time, as the volumes of data increase, so do the demands on processing performance,” the firm explained on its website.

Acatis said that it sees two main advantages to AI compared to human analysts, greater capacity and emotional detachment, and argues deep learning models can also find patterns that humans would not be able to detect.

It had already tested artificial intelligence in October 2016 for pre-stock selection of the Acatis Global Value Total Return UI fund.

The German manager added that it has set up a joint venture called Quantenstein with NNAISense which aims to develop artificial intelligence models in the area of long-term value investing.

Gary Robinson
Head of Video and Ezines at Open Door Media Publishing. Deputy Editor, International Investment. An experienced journalist and filmmaker with more than 20 years' financial services experience, both as journalist and originally as a fully qualified IFA, Gary works across both International Investment and InvestmentEurope titles. Previous video production credits include projects on BBC, C4 and SKY.

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