Learning machines play an increasingly key role in our everyday lives. From search engines, to online recommendations, medical diagnoses, speech recognition, rapid translations, traffic management, weather forecasting, fraud and crime detection/prevention, games strategy, etc. They transform the quality and efficiency of how we analyse information and help us to take smarter decisions.
Machines learn by analysing large sets of relevant data, identifying evolving patterns of behaviour and predicting future outcomes (what we do, what we like, what happens next). Whilst always trying to learn from mistakes and improve how we achieve our goals and manage risk.
Machines learn by analysing large sets of relevant data, identifying evolving patterns of behaviour and predicting future outcomes (what we do, what we like, what happens next). Whilst always trying to learn from mistakes and improve how we achieve our goals and manage risk.
Learning Machines are Transforming
Asset and Wealth Management
Case Study 1 -- Sanlam AI Global Managed Risk UCITS Fund
In March 2017, Sanlam, a 100 year old diversified financial services group with US$104 billion in AUM, US$10bn market capitalization and AA+ rated by Fitch appointed A.I. Machines as technology partner to operate the Sanlam AI Global Managed Risk UCITS Fund (AI GMR)
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A.I. Machines' PIE started powering AI GMR effective from June 2017, with no changes to the fund's existing objectives and guidelines, but using intelligent self-learning predictive systems capable of adapting to changing market conditions.
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AI GMR aims to provide long term capital growth through exposure to world equity markets in a risk controlled manner. It does so by dynamically adjusting the net equity exposure between 10%-90%.
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Sanlam AI Global Managed Risk UCITS Fund, INVESTOR & ADVISOR UPDATE and Q&A (3Q-2023)
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Gideon Nell of Sanlam and Alessandro Di Soccio of A.I. Machines provide an update on AI GMR, which is 5-star rated by Morningstar, and answer questions on A.I. Machines' PIE, the AI investment and risk management software engine that powers all the decisions of the fund. Outcome: as of September 30, 2023, Sanlam AI GMR UCITS Fund has outperformed its benchmark (Morningstar USD Flexible Allocation) over 1-year, 3 years, 5 years and AI since inception. |
Sanlam AI Global Managed Risk UCITS Fund, INVESTOR & ADVISOR UPDATE and Q&A (4Q-2023)
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Gideon Nell of Sanlam and Alessandro Di Soccio of A.I. Machines provide an update on AI GMR, which is 5-star rated by Morningstar, and answer questions on A.I. Machines' PIE, the AI investment and risk management software engine that powers all the decisions of the fund. Outcome: as of December 31, 2023, Sanlam AI GMR Ucits Fund has outperformed its benchmark (Morningstar USD Flexible Allocation) over 1-year, 3 years, 5 years and since AI inception. |
Sanlam AI Global Managed Risk UCITS Fund, INVESTOR & ADVISOR UPDATE and Q&A (1Q-2024)
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Gideon Nell of Sanlam and Alessandro Di Soccio of A.I. Machines provide an update on AI GMR, which is 5-star rated by Morningstar, and answer questions on A.I. Machines' PIE, the AI investment and risk management software engine that powers all the decisions of the fund. Outcome: as of March 31, 2024, Sanlam AI GMR Ucits Fund has outperformed its benchmark (Morningstar USD Flexible Allocation) over 1-year, 3 years, 5 years and since AI inception. |
Sanlam AI Global Managed Risk UCITS Fund, INVESTOR & ADVISOR UPDATE and Q&A (2Q-2024)
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Gideon Nell of Sanlam and Alessandro Di Soccio of A.I. Machines provide an update on AI GMR, which is 5-star rated by Morningstar, and answer questions on A.I. Machines' PIE, the AI investment and risk management software engine that powers all the decisions of the fund. Outcome: as of June 30, 2024, Sanlam AI GMR Ucits Fund has outperformed its benchmark (Morningstar USD Flexible Allocation) over 3 years, 5 years and since AI inception. |
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Gideon Nell of Sanlam and Alessandro Di Soccio of A.I. Machines provide an update on AI GMR, which is 5-star rated by Morningstar, and answer questions on A.I. Machines' PIE, the AI investment and risk management software engine that powers all the decisions of the fund.
Outcome: as of September 30, 2024, Sanlam AI GMR Ucits Fund has outperformed its benchmark (Morningstar USD Flexible Allocation) over 3 years, 5 years and since AI inception. |
Case Study 2 -- Prospero AI ETF Portfolios (Conservative, Balanced, Growth, Dynamic)
In May 2015, A.I. Machines funded a Dynamic asset allocation (AI Dynamic) strategy fully powered by AI as a test case for PIE.
PIE allocates across 3 assets (equities, bonds and cash) and is run unconstrained, with the allocation to each asset ranging 0-100%, with a weekly forecast horizon. Every week PIE determines the size of the allocation to each asset based on a careful analysis of assets behavior, market conditions and overall portfolio risk.
In March 2017, AI Dynamic, and another 3 new multi asset portfolios, AI Conservative, Moderate, and Growth were launched as unitized managed accounts with daily NAVs. These new portfolios are more diversified than AI Dynamic in terms of the investment instruments they can choose, within specified boundary conditions, among best of breed low cost ETFs. |
It is important to note that the AI Portfolios do not “think” like a human portfolio manager or a conventional asset allocator. Their critical thinking process is generated by A.I. Machines’ PIE, an un-biased AI investment engine, which utilises multiple AI and machine learning methods to perform complex analysis of asset behavior and market data. Unlike a human portfolio manager, PIE does not rely on any a priori assumptions about asset and market behavior and risk, and instead develops its own knowledge from publicly available market data. Ultimately, the AI Portfolios are designed to deliver to investors improved investment outcomes, including a smoother equity curve and a more attractive capital loss profile. Importantly, they can act as powerful diversifiers of conventional multi asset portfolios within broader investment portfolios. |
The Prospero AI ETF Portfolios are available via the Prospero Investment Savings Plan through the Prospero Bermuda Trust and the Prospero Jersey Trust and have a 6 ½ year track record. Outcome: as of December 31, 2023, Prospero AI ETF Conservative, Moderate, Growth, and Dynamic Portfolios have outperformed the reference benchmarks (Morningstar Cautious, Moderate, Aggressive, and Tactical Allocation) year-to-date, over 1-year, 3 years, 5 years and since inception. For further information please visit: Home - Prospero Bermuda (prosperoinvest.com) |
Case Study 3 -- The Glacier AI Funds
In September 2018, Glacier, a South African provider of wealth management services with R281 bn (circa US$20 bn) in assets under administration, launched Glacier AI Flexible, the 1st South African retail multi-asset, AI driven fund.
On the back of the success of the Glacier AI Flexible, in December 2021, Glacier launched the Glacier AI Balanced, a multi asset, AI driven fund, built on the Regulation 28 framework and Regulation 28 compliant, making it suitable for inclusion in a retirement savings solution for less aggressive investors. |
The funds allocate between equities, fixed income and property, onshore and offshore. Both funds are entirely driven by A.I. Machines' PIE, which performs the following: instrument analysis, portfolio recommendations, allocation decisions.
By utilising artificial intelligence, the intention is to diversify human manager risk by removing human emotions and behavioural biases in portfolios. Consequently, the funds are able to provide diversification benefits to both active and passively managed solutions. |
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Glacier AI Flexible aim to provide superior capital growth over the medium to long term within a flexible mandate. Glacier AI Balanced can be chosen by investors who are sensitive to drawdowns and high levels of portfolio volatility, but who need to build wealth over the longer term. It can therefore be used in both a pre-retirement (wealth accumulation) phase as well as a post-retirement (wealth decumulation) phase. For further information please visit: Local Funds (glacier.co.za) |