DWS's stake in Arabesque showed how asset management is moving towards AI-powered investing. Artificial intelligence, hailed as investing's next frontier, is already widespread in various forms, but its true potential in portfolio management is still far from being fulfilled. In a study on AI and finance for the Alan Turing Institute, Professor Bonnie Buchanan puts AI's "impressive" growth down to declining processing and data-storage costs, and an immense availability of data. But compared to other fields, the quantity of data or the ability to create and collect new investment data is still not sufficient, despite its abundance, according to Michael Neumann, head of AI quant investing at Arabesque AI in London. Financial data also comes with a lot of'noise', and the definition of success or failure can be more nuanced.

The fund embeds machine learning techniques within the investment process and will use a variety of quantitative techniques to time its investments. The investments will be based on'factor premia' - those sources of risk such as value, quality, momentum, small size and low volatility that can provide investors with persistent risk-adjusted excess returns. The Aberdeen Global Artificial Intelligence Global Equity SICAV, launched in Luxembourg, is a collaboration between Aberdeen Standard Investments' Quantitative Investment Strategies team and Mitsubishi UFJ Trust Investment Technology Institute (MTEC)/Mitsubishi UFJ Trust and Banking Corporation in Tokyo, Japan – a centre of excellence in robotics, artificial intelligence and financial technology. Martin Gilbert, Co-CEO at Standard Life Aberdeen, said: "For active investment management firms, the ability to use machines to read and understand vast amounts of data in order to forecast market moves more accurately has spawned innovation and a resurgence in active quantitative investment approaches. "To benefit from this AI-driven innovation, and to complement our highly successful active fundamental strategies, we are proud to have collaborated with the MTEC – Japan's leading and most prestigious financial technology think-tank – and the Trust Bank to develop this active quant fund." Junichi Narikawa, president of Mitsubishi UFJ Trust Investment Technology Institute (MTEC), added: "This is the first time in MTEC's 30-year history where we have collaborated with an entity in Europe and are pleased to work with a world-class investment firm of the calibre of Aberdeen Standard Investments.