If you are looking for an answer to the question What is Artificial Intelligence? and you only have a minute, then here's the definition the Association for the Advancement of Artificial Intelligence offers on its home page: "the scientific understanding of the mechanisms underlying thought and intelligent behavior and their embodiment in machines."
However, if you are fortunate enough to have more than a minute, then please get ready to embark upon an exciting journey exploring AI (but beware, it could last a lifetime) …
Financial advisors are starting to be big fans of artificial intelligence (AI)--not only because it can automate administrative tasks like data entry but also because it is starting to have a significant impact on the client-advisor relationship. "Against increasingly challenging market conditions, AI has the potential to help wealth managers sustain and drive new growth, create operating efficiencies, and transform the customer experience through more hyper-personalized insights and products," said Scott Reddel, who leads the North American wealth management practice at consulting firm Accenture. "Now isn't the time to take your foot off the pedal. Firms can overcome adoption speedbumps with continued commitment from management, focused applications that deliver business value, and--perhaps most critically--collaboration across business lines." Accenture recently released new research, "AI in Wealth Management: A Financial Advisor Study," after surveying 500 licensed financial advisors in the United States and Canada earlier this year who work at major wealth managers, banks, insurers, and independent wealth firms.
"Rising demand is driving the boom of digital humans," says Shiyan Li, head of the digital human and robotics business at Baidu, which created the digital model-actor, Gong. "In China alone, there are over 400 million ACGN (animation, comics, games, and novel) fans, and an enterprise market worth hundreds of billions of dollars centered on digital humans." And according to a company that tracks business registrations, Qichacha, China now has more than 280,000 enterprises that engage in digital human-related activities. The debut of Baidu's digital celebrity may not seem like much at first, as the concept of "virtual idols" has been around for years. For example, US virtual influencer Lil Miquela has been appearing alongside real human celebrities in online advertisements and TV commercials since 2016, gaining over three million Instagram followers.
This has heightened the need for wealth management firms to embrace technology, including artificial intelligence, to arm their advisors with data and tools that will improve the quality of advice and how it is delivered. And yet when it comes to exploring AI to help advisors onboard new clients and provide more relevant advice to existing ones, most firms are stuck in low gear, with few putting the technology at the core of their business. Indeed, less than one-third of the wealth managers we surveyed are scaling AI across their businesses. Part of the problem is getting buy-in and engagement from financial advisors who need convincing that insights created by AI will be actionable in their day-to-day roles. In some instances, recommendations provided by AI don't match clients' immediate needs or stages of life.
The general consensus appears to be leaning towards the idea that artificial intelligence can replace the role of human financial advisors and therefore, those in the industry must adapt or risk getting left behind. But before jumping to that conclusion, it's worth exploring some important questions: what's next, what is needed and who needs it? And, perhaps crucially, whether AI will ever remove the need for human advisors in the financial industry. AI transforming financial sector Business leaders have revealed that the use of technology including AI plays a significant role in filling gaps within financial services offerings. Jim Pendergast, Senior Vice President and General Manager at AltLINE by The Southern Bank, has said that AI can improve the consistency of financial advice.
JIFFY.ai & Docupace: "Docupace, the leader in cloud-based fintech digital operations software for the wealth management industry, and JIFFY.ai, the innovative provider of true end-to-end intelligent automation applications, announced the companies are jointly developing the wealth management industry's most powerful suite of automation solutions; deploying leading-edge capabilities such as intelligent document processing, artificial intelligence (AI), robotic process automation (RPA), as well as machine learning and advanced analytics to deliver benefits at scale across enterprise operations." Michael Pinsker, founder and president at Docupace, stated, "Docupace and JIFFY.ai are leveraging our collective wisdom to take the most advanced technologies and pointing them directly at our clients and the wealth management industry's biggest pain points and most common issues of operational inefficiencies." RISE Financial: "RISE Financial, a subsidiary of Siebert Financial Corp., a provider of financial services, announced that it has completed the acquisition of a 20% equity stake in Hedge Connection, the only woman-owned fintech company offering a patented enterprise capital introduction SaaS solution through its product Fintroz. As part of the transaction, RISE Financial acquired the right to purchase up to the remaining 80% of Hedge Connection. Hedge Connection's powerful Fintroz platform allows hedge fund managers to connect with a global pool of institutional investors and retain control over how their information is shared while helping allocators to streamline due diligence. The Fintroz platform provides RISE Financial and its division, RISE Prime, with a technology solution to efficiently scale a comprehensive capital introduction program for clients."
Fidelity Investments has a new business providing financial institutions with technology to create compliant public communications material. Called Saifr, the new business will offer tools powered by Natural Language Processing (NLP) models trained on tens of millions of compliance-reviewed data records. The goal is to foster greater collaboration between a firm's marketing and compliance teams creating, reviewing and approving client communications, said Vall Herard, managing director of Saifr. "Ensuring that marketing materials are compliant with various regulatory rules requires multiple touchpoints inside and outside an organization, including content creation, compliance feedback, revisions, email, and workflow hand-offs," Herard said in a statement. "As a result, the process can be inefficient and create the opportunity for friction and risk."
AI is at the heart of digital disruption and on its way to becoming one of the biggest game-changers in the next few years. Early adopters of AI are reaping significant benefits and have differentiated themselves from the rest. As a result, the AI sector is garnering the attention of numerous investors globally, increasing the number of AI unicorns in just a few years. In India itself, as many as 11 startups earned unicorn tags during the black swan year 2020. This article lists all the AI companies that have reached a valuation of $1 billion or more. A technology platform company, Argo AI, is creating integrated self-driving systems. These are manufactured at scale for safe and reliable deployment in ride-sharing and goods delivery services. Along with Ford and Lyft, Argo AI is planning to launch a self-driving ride-hailing service in the US.
One of the world's biggest wealth managers doesn't think artificial intelligence can replace the role of financial advisors. Ralph Hamers, the CEO of UBS, said Wednesday that technologies like AI were better suited to handling day-to-day functions like opening an account or executing trades than advising clients. "There is no added value for client advisors to be engaged in a process like that," Hamers told CNBC's Geoff Cutmore at the virtual CNBC Evolve Global Summit. "Our financial advisors actually should be supported by the technology," Hamers said, adding that AI could be used to make sense of the research and other data that advisors don't have time for. "That is what artificial intelligence can do, because even our client advisors can't read all the research that is there," he said.
June 18, 2021: -One of the world's most prominent wealth managers doesn't think artificial intelligence can replace the role of financial advisors. On Wednesday, Ralph Hamers, the CEO of UBS, said that technologies such as AI were better suited to day-to-day handling functions such as opening an account or executing trades than advising clients. "There is no added value for client advisors to be engaged in the process like that," Hamers told CNBC's Geoff Cutmore at the virtual CNBC summit. "That is what artificial intelligence can do because even our client advisors cannot read all the research that is there," he added. "Our client advisors can't comprehend all the product options that are out there," he added.