AXA Investment Management’s quantitative investment team is set to bolster its remit with the use of AI (artificial intelligence) and Big Data, the company has announced.
The Rosenberg Equities team will integrate advanced modelling techniques that specifically utilise neural networks into the investment approach.
The development is set to further enhance its analysis of data as well as complementing the firm’s existing investment process.
As part of the integration, the firm’s Sustainable Equity strategy will now include a neural network mode.
This is with the aim of improving the strategy’s ability to identify stocks that are at risk of extreme price events, mitigating tail risks and seeking to improve risk/return outcomes for clients.
In addition, the team is also looking at new ‘unstructured’ data sets, which complement the traditional financial data investors have historically focused on to provide deeper insights into company fundamentals and sentiment.
Rosenberg Equities is also developing a ‘natural language processing’ model to analyse company filings and other text sources, in order to create new insights into investor sentiment associated with a company.
Commenting on the new implementation, Gideon Smith, Europe CIO of AXA IM Rosenberg Equities, said: 'This is the first step in us using neural network techniques and advanced artificial intelligence in client portfolios, but is a natural progression of the advanced quantitative techniques we’ve adopted over the last thirty years.
'We believe this is a considered step and consistent with our investment approach of modelling and managing investment risk for clients.'