As you may know, the SRP 14th annual Europe Structured Products & Derivatives Conference is taking place in London right now as we speak where senior representatives from retail and private banks, insurance companies, investment banks, fund managers, law firms, regulatory bodies and independent investment advisors gather for networking and debate. Our Sales and Business Development Executive Lucas Bruggeman joins the conference as a panelist where he shows the crowd why technology companies are the banks of the future.
One of the main goals the conference tries to grasp how technology will share the financial products of the future, something that Sentifi and Bruggeman have a clear vision of. During his panel, Bruggeman provided answers to some of the burning questions. Here were his insights.
First question will be a bit visionary, but describe what you think a bank of the future will look like.
Banks of the future will have these following characteristics:
- They listen to their customers, are 100 percent client-oriented, and enable their customers to make good investment decisions.
- They become much more clever about using data and social media data in order to add value to their customers.
- They ensure their customers are informed through reliable sources.
With personalized products, you have a much greater choice, but how do you know what to buy? Do advisors and investors need tools to help them decide what to buy?
What we do at Sentifi actually offers an answer to the questions. We listen and rank millions of relevant sources in the financial markets, and we are able to summarize what the market is saying. Technology helps in the form of artificial intelligence, machine learning and deep learning.
By using those technologies, we can filter the essence from millions of messages and other data in order to stay more comprehensively informed, to know what our friends are buying, to know whether or not those purchases are sound investment decisions, to decide what we buy or sell.
We have heard a lot about robo advisors. How do you think the market will evolve with these? Will they help people make investment decisions from the current scope of products, or do they open up opportunities to create new types of products?
Time and performance will tell. The fact of the matter is that more and more banks and financial institutions are either buying or working with them. Again it’s important that the client in the end can make a better decision in investing, hereby trusting a robot to give structural and efficient advice.
Regulation in many ways created a checklist-based advisory process for many at the moment. Are we heading for a situation where we can replace people with robo advisors who manage the checklists and propose relevant products?
Technology is available to help increase efficiency and transparency in case the rules are disclosed and understandable. But the million-dollar question here is that: Will robo advisor have the same level of reliability and trust that human advisors have? Maybe in the future, but surely not today.
Are there the risks of unintended consequences with AI and crowd-based strategies? Recent media reports seem to imply that you can build momentum and create a crowd through fake news, etc. Could AI-based investment intelligence also be tricked or accidentally driven by the masses following something which is ultimately fake?
That’s a great question, one that Sentifi is actively trying to solve. Not only have we the ability to spot and remove bots, we are using our AI to rank each of the millions of voices we listen to. While the machine can’t tell you whether a message is actual news, it does have quite a lot of source-related relevant information at its disposal — history of messages, quality and quantity of followers, etc. — to tell our customers whether the voice is financially relevant and worth listening to.
Regulation has been a topic that has dominated our focus and, in many ways, has been seen as a restriction to innovation in our business over the last few years. How do technology and regulation sit together now? Do you see opportunities for innovation through technology as a direct result of regulatory changes?
Technology can help to ensure that you as an investor, or a bank, are compliant to all the rules and regulations. Risk and compliance processes now and in the future can’t run without efficient use of technology.
Are we predicting that investment decisions of the future will come down to man vs. machine? Will AI determine how we invest? Will it able to deliver better returns than the traditional investment approaches?
Because of the growing number of participants in the financial markets, we will not be able to make investment decisions without the help of AI or technology. The key to making investment decisions is to listen to the highest ranked voices and sources. It’s not the quantity but the quality of voices that will make the difference.
In conclusion, technology companies will not be the banks of the future, but will cooperate with banks, and the banks themselves will become more “technical companies.”
The conference runs on Feb. 1-2 in London, so remember to catch more insights from other panelists. Follow Lucas Bruggeman on Twitter at @ to pick his brains about everything AI, technology and banking. To harness all the insights from more than 5 million credible voices in the financial market, register for a free Sentifi account here.