EquBot, a well-known company in integrating deep learning financial analysis with the cognitive ability of AI, recently revealed the introduction of the AI-driven International Equity ETF, AIIQ. The artificial intelligence (AI)-powered Equity ETF operates on the Watson platform.
Chida Khatua, the company’s co-founder and chief executive officer, said that after considering the next iteration of its artificial intelligence (AI)-powered investment technique, the best logical step for the company was expanding its focus to cover all the developed markets located away from the US. He also expressed EquBot’s excitement in delivering AIIQ to the market as well as boosting the use of artificial intelligence in fueling investor’s portfolios. Furthermore, AIIQ operates as an actively managed ETF, which concentrates on equity securities of firms that are based in developed markets, particularly those outside the United States.
The selection of securities is made based on the outcomes of a quantitative, proprietary, AI-powered model that operates on the Watson platform. The EquBot model can rank thousands of stocks daily based on the probability of every entity benefitting from current world events, trends, and economic conditions. It also recognizes between 80 and 250 firms, which boast the potential for price increment within the next one year, for inclusion into the portfolio.
EquBot unveiled the AI-driven Equity ETF back in October last year. The company told Market Watch that the fund’s software continuously evaluates information for almost 6,000 of the United States listed stocks. It does so through scanning through social media posts, news articles, regulatory filings, traditional financial metrics and social media posts. Additionally, it software looks into factors regarding valuations and correlations in a bid to locate investments the investments that it considers as undervalued.
The EquBot model also intends to include a volatility screen, with the objective of maintaining portfolio volatility in comparison to that of the wider developed markets ex-United States. The individual securities cannot go beyond weights of 10% in AIIQ. What’s more, the new ETF was launched with 150 holdings whereby the top 10 holdings consist of Yandex NV, a Russian Internet search giant and Toyota Motor Corp.
EquBot’s revolutionary technology is propelled by its proprietary algorithms that run across multiple artificial intelligence (AI) cognitive computing platforms. In both portfolio construction and asset management, the company’s technology integrates qualitative and fundamental analysis while coming up with new investment ideas through the use of artificial intelligence. It uses large volumes of data to create predictive financial models on over 15,000 local and ex-publicly traded entities in the United States and developed markets globally. Some of the data points that are fed into the model include company financial data, n market signals, social media sentiment and financial news.
Khatua asserted that in a bid to fully comprehend the factors that affect an individual’s equity, you should first be in a position to identify or locate, synthesize and assess thousands or even millions of data pieces. He emphasized his point by saying that no individual analysts or even a team can process such a heavy load of information on time, which raises the need to leverage the power of AI.