BlackRock: AI tools like ChatGPT are a ‘revolution’ in investment analysis, able to pull nuance from vast data sets
- Daily news, broker reports, government statistics and geospatial data can all be analysed by AI to give clues about investment direction, says co-CIO
- World’s largest asset manager believes AI will be transformational, but its use is less about replacing people than augmenting investment analysis
An AI model using machine learning can crunch massive amounts of data to help investment analysts assess economic conditions, said Jeff Shen, co-CIO and co-head of systematic active equity at BlackRock, the world’s biggest money manager with US$9.42 trillion in assets under management as of June 30.
Daily news, broker reports, expert insights and government statistics all provide data that can be analysed by AI to give clues about the underlying economic situation, he said. Meanwhile, geospatial information can be used to identify trends by analysing patterns in, for example, the movement of trucks in and out of a company’s warehouses, or foot traffic in a city.
“We are in this world where big data is upon us, and a lot of things can be measured that could be relevant to investment,” Shen said at a media round-table in Hong Kong on Tuesday. “Generative AI and big data is transforming pretty much every industry out there. I don’t think investment will be immune to it.”
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Shen leads a team that includes “people with PhDs” such as computer scientists, engineers, physicists and mathematicians, as well as traditional finance analysts. The team is already using LLM-based AI to help construct portfolios.
