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HSBC Launches AI-Driven Investment Strategy

Editorial Staff 30 March 2023

HSBC Launches AI-Driven Investment Strategy

The multi-asset index leverages IBM Watson’s Artificial Intelligence engine to deliver resilient returns in changing market conditions. It is an example of how banks and other firms are jumping into the AI trend in the hope of winning clients and revenue. 

Developed by HSBC Global Private Banking and EquBot, Artificial Intelligence Powered Global Opportunities Index is a rules-based investment strategy featuring IBM Watson’s AI engine and other patented technologies which help turn data into investment insights and forecast techniques to optimise asset allocation, the bank said in a statement this week.

The index provides global diversification with opportunistic exposure to 18 assets spanning global equities, fixed income, inflation-sensitive assets and cash. The portfolio is rebalanced weekly to remain nimble and seek resilient growth, the bank continued.

Such investment ideas show how popular - at least in terms of the publicity and noise around offerings such as chatGPT - artificial intelligence now is. It appears to be catching up or even overtaking ESG investing as a "hot" topic in wealth management. AI has prompted fears that certain forms of human labour will be made redundant, while others argue that it should enhance rather than replace people. (In the wealth sector, for instance, this publication hears the argument that AI and related tools can make RMs more effective at their jobs and free them from drudgery.)

Featuring a 100 per cent floor at maturity, the structured product enables participation in the performance of the investment strategy. It was manufactured by HSBC Markets and Securities and is available to HSBC’s global private banking clients and clients with professional investor and accredited investor status booked in Hong Kong and Singapore.

Siew Meng Tan, regional head of HSBC Global Private Banking, Asia Pacific, said: “We are absolutely committed to providing our clients with the solutions they need to help them navigate this fast-changing environment and build future-fit portfolios. This innovative solution is another such example.”

Stefan Lecher, regional head of investments and wealth solutions, Asia Pacific, HSBC, added: “Our clients look to us first for actionable ideas and portfolio-level advice to keep them on track to achieving their objectives.” 

“Against this dynamic backdrop, the launch of AiGO8 underscores our ability to move quickly to deliver relevant solutions that leverage cutting-edge technology,” he said.

The way that AI is used as a term can be controversial. In a recent comment by Bloomberg columnist Parmy Olsen, she wrote that “Artificial Intelligence in particular conjures up the notion of thinking machines. But no machine can think, and no software is truly intelligent. The phrase alone may be one of the most successful marketing terms of all time.”

The phenomenon has been a part of popular culture for decades, such as with the computer “HAL” in the Stanley Kubrick film, 2001: A Space Odyssey (the machine goes beserk and tries to kill all the astronauts), or more benignly, in the recent US film Interstellar. Chess player and commentator Gary Kasparov, who was defeated by an IBM supercomputer Deep Blue in 1997, has written about his thoughts on what intelligence actually is in his book, Deep Thinking.


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