German investment firms Acatis Investment and BayernInvest have partnered to launch on 23 March 2017 the BayernInvest Acatis KI Aktien Global Fonds, which will be the first fund entirely controlled by artificial intelligence.
Stock selection, weighting and reorganisation activities rely on the deep learning models. The fund manager no longer intervenes in the portfolio decision-making process, said 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 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. 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.
“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 explains on its website.
Acatis 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.
Acatis had already tested artificial intelligence in October 2016 for pre-stock selection of the Acatis Global Value Total Return UI fund.
The German manager 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.