AI a growing threat to employment in capital markets
Acadian, a quant-based asset manager with $77bn in AUM, claims to be the first company to incorporate Microsoft's Bing Predicts in its stockpicking platform. The firm is looking to gain an edge based on Bing's ability to draw information from consumer data and identify broader trends. Separately, on the fixed income side, two-year-old AI-driven search engine Bitvore, is targeted at major ratings agencies, wealth managers and insurers. Bitvore is designed to act like a credit analyst, it trawls the internet for data that can be used by bond traders, focusing particularly on municipal debt.
Bitvore is a “continuous analysis engine,” Jeff Curie, CEO of the firm, told ThinkAdvisor in an interview. It’s designed to “monitor information as it’s changing, and look for very specific things.”

The platform is trained to act like a credit analyst, he said, especially in municipal markets, where it’s “monitoring the issuers of municipal debt.” Bitvore is rolling out a new product that will cover corporate information, he said.

“We can correlate the news about a change in an issuer all the way down to the CUSIP number,” he explained, “and alert them when something happens.”

Curie said about 350,000 articles flow through the system each day, and “99.5% are not material” to bond managers. “You really can’t put human beings at this scale of problem and do it well,” he said. “AI is a really good fit. It automates a repetitive — basically drudgery — problem for very highly paid people.”

“The AI is trained to watch for the things that a credit analyst watches for; so it’s looking for things that would affect the risk of the bond,” he said. “We’re watching for things that would cause revenue to fall: taxation issues, unemployment problems, lawsuits against a hospital, changes in executive management, a nursing strike – all these things would affect a bond and its ability to pay.”

Curie calls this analytic support “automated intelligence. Our aim is not to do the trading for them,” he said. “Our aim is to make people have all the information they need at their fingertips.”