Artificial Intelligence Hedge Funds Outperforming Humans

Quantitative investing, one of the latest paths available to hedge fund managers and incorporating computer analytics in innovative new ways in order to make precision investment decisions, may have a new challenger emerging from within its own ranks. According to a report in January by Eurekahedge, the quickly-changing landscape of alternative investing strategies has seen a sudden rise in the prominence of artificial intelligence-based (AI) funds, and that many of these funds are vastly outperforming so-called "traditional quants", as well as human-led management teams. According to a report by ValueWalk, Eurekahedge's AI/Machine Learning Hedge Fund Index, monitoring performance of 23 hedge funds utilizing this investment strategy, has managed to outperform generalized hedge funds as well as traditional quant funds decisively since 2010. In fact, AI funds have netted annual returns of 8.44% for the past 6 years. This is dramatically higher than the other indices that Eurekahedge uses, including the CTA/Managed Futures index, with 2.62% returns for the same period, and the trend following index, which saw a mere 1.62% return level at the same time.