Can robots learn to manage risk? - Risk.net

From the shiny corridors of BlackRock's Palo Alto laboratory, to the cramped shared workspaces of scientifically minded hedge fund start-ups, to the hallways of quantitative investing stalwarts such as Renaissance Technologies and Two Sigma, artificial intelligence (AI) is being adopted as the new temple of asset management. Even discretionary managers are starting to bring in data scientists and machine learning experts. Most attempts to apply AI so far have been in stock price forecasting. But risk managers are asking how the technology can be harnessed in their domain also. One area of exploration is the use of machine learning to replace traditional approaches to risk modelling.