AI Case Study

The Equbot AIEQ Exchange Traded Fund informs portfolio decisions from data including financial documents and social media posts using AI algorithms to predict price changes

The AIEQ offers an equity exchange traded fund (ETF) which derives investment advice from analysing a variety of data including financial documents and press releases using an in-house "Equbot". The fund is actively managed as a human makes the final decisions with regards to investments.

Industry

Financial Services

Fund And Asset Management

Project Overview

According to The Wall Street Journal, "EquBot’s approach ranks investment opportunities based on their probability of benefiting from current economic conditions, trends, world events and company-specific events. With artificial intelligence, computer systems are able to perform tasks that would normally require human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages. The fund’s underlying technology is constantly analyzing information for approximately 6,000 U.S.-listed equities, including company management and market sentiment. Every day, it processes more than 1 million regulatory filings, quarterly results releases, news articles, and social media posts."

From The Globe and Mail: "The AI Powered Equity ETF seeks to provide investment results that exceed broad U.S. Equity benchmark indices at equivalent levels of volatility. The fund typically invests in 40-70 names but analyzes and compares thousands of U.S. companies on a daily basis to find and optimize exposures within the portfolio."

Reported Results

The ETF initially underperformed the market. The fund's current performance can be found here: http://www.equbotetf.com/fund/#performance
An update on its performance from 2018 from the Motley Fool revealed that the Equbot AIEQ ETF performed worse than the S&P 500 "in total return with a 7.7% loss compared to a 4.6% loss."

Technology

IBM Watson and proprietary in-house algorithms

Function

Strategy

Data Science

Background

AIEQ is an actively traded equity fund. From the Equbot website: "In 2016 Equbot became part of the IBM Global Entrepreneur start-up program to innovate investment solutions with the use of artificial intelligence. Our first product, the AI Powered Equity ETF is focused on the investor with demand for U.S. equity investments with broad index volatility levels. Equbot serves as the sub-adviser to the fund."

Benefits

Data

Public; regulatory filings, quarterly results releases, news articles, and social media posts