Sanlam Global Investment Solutions to launch AI and machine learning capabilities
Sanlam Global Investment Solutions (SGIS) is to launch its first investment capability wholly managed by artificial intelligence (AI) and machine learning (ML) in March 2017.
The fully automated investment process uses multiple machine learning techniques to learn from large sets of data, deduce evolving relationships and predict expected price with a high degree of accuracy.
The investment engine also contains an AI risk manager which attributes weights intelligently across asset classes. Its goal is to achieve a certain minimum level of return while minimising expected portfolio capital loss.
The financial markets have been through significant change in recent years and with bond yields at all-time lows and equity markets at all-time highs, SGIS believes an investment strategy that worked in the past may not work going forward.
To this end, SGIS has appointed London based AI Machines, a financial technology specialist, to manage a number of investment mandates using their advanced Artificial Intelligence & Machine Learning investment engine.
Cobus Kruger (pictured), CEO of SGIS, says: “The majority of industries are embracing artificial intelligence and machine learning to ensure their clients’ experience is the best it can be. However, the mainstream asset management industry is way behind the curve in implementing AI. Now is the time to challenge the status quo of investing. In order to succeed you need an investment strategy that adapts to deal with the new paradigm in markets.”
David Itzkovits, head of investments for SGIS, says: “The AI capability works by constantly adapting to changes in markets. We have leveraged a systematic investment strategy since 2010 in the form of Sanlam Managed Risk and this new AI capability is the natural evolution of that strategy. The AI investment engine derives its returns in a different way to other investments and should be viewed within a client’s overall investment strategy and as a diversifier of manager risk.”
Gideon Nell, head of global distribution for SGIS, adds: “At SGIS, we have been on a quest to supply investors with a truly differentiated investment solution designed to eliminate human emotions, actively adapt to changing markets and help to materially improve the consistency of achieving investment goals with significantly reduced downside risk. We believe the AI capability ticks all these boxes. The absence of human input to make investment decisions continues to support our belief in behavioural finance.”