Hedge fund managers are aware that technology is going to change their industry and nearly 60% of them think artificial intelligence and machine learning will have a medium to high impact.
While most accepted that technological advances were going to change the industry, there were a variety of responses as to the extent of the upheaval. One manager said: “There’s a very strong business case for replacing humans with algorithms in a lot of areas of the business.”
But another manager said: “I’m not sure that robots will completely take over the firm.”
The findings are in a report by KPMG, the Alternative Investment Managers Association and Managed Funds Association. Called ‘Transformative change’, over 100 hedge fund managers and executives were surveyed about technology.
The report found that hedge fund managers recognised the competitive advantage of innovation, as 94% said technology will have an impact on competition over the next five years.
Another driving force behind investment in technology is the belief that it can improve compliance and control, according to 90% of the managers surveyed.
The responses illustrated that technology and related issues – such as artificial intelligence and cyber security – are having a profound effect on the business. One fund manager with over 25 years of experience said: “I’m pretty sure that by the time I’m out of the business it will be completely unrecognisable from where it is today.”
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