Why do traders in investment banks feel their jobs are immune from AI, etc?
because traders are used to seeing such predictions fail.<p>Reuters was trading FX electronically since the early 1990s. At the tier one IB I worked for the IT budget was 500m USD a year (across products), and that was in 1997! Huge resources were thrown at automation. However, to this day, large trades in FX (&gt; 10m USD notional) are still almost exclusively performed by humans over a telephone or over the bloomberg messaging system.<p>That&#x27;s because, no matter how much you automate stuff, there is still the 1% &quot;edge case&quot; scenario where something goes wrong, and when that happens, you most definitely want a human that you can &quot;look in the eye&quot;, when you have that sort of execution risk. Remember that markets move really fast and there is a lot of risk in big trades that &quot;go wrong&quot; because unwinding said trade will almost certainly cost one of the sides a fortune.<p>Also, high finance is not just about what you know. It&#x27;s inevitably about <i>who</i> you know, about &quot;illogical&quot; factors such as salesperson charisma, entertainment, and most importantly, a credible personality type that understands the edge case risks.  These things are very hard to replicate with a machine. You&#x27;ll say they should be, that these things are unfair, but they remain a fact after many attempts at removing them have failed.<p>As for AI, let&#x27;s for now call it what it is: machine learning. Learning from the past. That&#x27;s fine for recognising stop signs at different distances, angles and degrees of noise. But in finance, the past is often misleading. Sure there&#x27;s trend, but there are also very big instabilities in the historical correlation matrix. Paradigms shift without you even realising it. The constant is change. AI is not good enough at that, <i>yet</i>.<p>BTW, that&#x27;s not to say machines are not making inroads. It&#x27;s becoming almost impossible to get a decent trading job now with knowing at least R and Python to a comfortable degree, and good quant programmers cost a fortune. There&#x27;s massive demand.