ASSISTED INVESTING

New-age traders see AI as an indispensable tool, one that can process vast datasets on a scale no human can match. But some market veterans warn that it has the potential to amplify herd behaviour and trigger flash crashes

- BY PRASHUN TALUKDAR

DEPENDING ON WHO you are listening to, artificial intelligence (AI) is either the holy grail of investing or a phenomenon that can undermine stock market probity and integrity. Both sides argue their case with reason, conviction and passion.

AI is transforming the way markets are analysed, trades executed and risks managed. Yet, the growing reliance on machine-driven market strategies carries risks.

AI may speed up data processing and enhance real-time analysis; but on the flip side, it has the potential to amplify herd behaviour and trigger flash crashes, say experts. AI's expanding footprint in the markets has become a hot issue as the technology that enables computer systems to mimic human cognitive abilities makes rapid inroads.

Market veteran Arun Kejriwal provides a cautionary counterbalance to the optimism surrounding algorithmic investing. Having observed the markets for decades, he argues that AI is in its infancy and still struggling to adapt to the complexities of a live trading environment.

Some traders see AI as an indispensable support system-one that can process vast datasets and accelerate decision-making on a scale "no human can match".

AI-DRIVEN ANALYSIS

Fintech platforms emphasise the significant advantages AI brings to modern investing, particularly in processing large and complex market datasets.

For Yashas Khoday, chief product officer and co-founder of trading platform FY-ERS, AI is a game-changing analytical engine.

"AI is fundamentally changing how investors make sense of complex market data. First, it can process huge volumes of information, from price charts and earnings to news and sentiment, all at once," he says.