Technology has always been viewed as a tool for advancement but for businesses who refuse to adapt, technology can be their demise.
From the 80s up to the early 2000s most individuals who want to passively invest are reliant on fund managers. Fast forward to recent years, the role of asset managers have been reduced to consultants. And even with consulting, technology now offers alternatives like index trackers and smart beta products which makes passive investing easier for those with minimal financial know-how.
Today, the possibility of having Artificial Intelligence and robots or machine learning invest your money for you is now a close reality. Morgan Stanley has implemented an AI to study the strategies of its financial analysts and find areas they can improve on. EquBot which uses IBM’s proprietary AI technology is one of the most successful applications of modern technology in trading. Their advantage over humans? The speed in which they read and analyze thousands of data from various sources and interpreting those data to make the most sensible investments while continuously improving.
Read also: Difference Between AI and Machine Learning
The idea is to recognize patterns across management teams, across financial statements, across news [and] things like social media, to identify trends that are occurring in the marketplace and to capture the companies that are going to appreciate the most over the next six to 12 months.
Said in interview
Now, financial services companies are at a crossroads. Should they invest in incorporating these technologies to their existing business models while the rate of adoption is still low or wait for other companies to demonstrate the success in using them?
With the fast-changing landscape of the industry and the increasing demands of consumers today, companies have no choice but to digitally evolve to stay relevant and competitive. Companies with big resources have the ability to dominate the market once they have a foothold and at any moment Fintech companies can offer modern solutions that can make traditional services obsolete.
While investing in these technologies can be expensive, it can spell the difference between continued success and closing down. However, the correct strategy and application still play a huge role in the success of a company’s digital innovation. Most companies with limited resources are opting to start with smaller products to test the interest of their customers. Others are working directly with technology companies who have expertise in executing complicated projects.
In this infographic by Prototype, a Dubai-based digital transformation agency, you can explore the various technologies financial companies can leverage to stay competitive.
