‘Machine learning’ experiments target quantitative investing
Man Group’s computer-powered AHL hedge fund plans to ratchet up its investment in “machine learning”, a hot new area of artificial intelligence that is garnering increasing attention in the investment industry.
AHL, which manages more than $19bn, is mostly known for investment strategies that follow trends and its two main funds have returned an average of 12-13 per cent annually since the mid-1990s.
Machine learning involves writing algorithms that can continuously “learn” from evolving data, and is an increasingly popular niche of AI that is being used for everything from generating film recommendations for Netflix to Google’s translation service. Sophisticated hedge funds and other money managers are ramping up their use of the technique.
The success of AHL — its four main vehicles returned between 3.9 and 7.6 per cent in the first quarter, despite the turbulent markets — helped keep Man Group’s overall funds under management relatively steady at $78.6bn, as net inflows of $1.3bn into its “quant” funds offset outflows from its more traditional hedge funds.
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Source: The Financial Times