Who are the earliest adopters of new technologies? Cutting-edge stuff tends to be expensive, meaning the answer is often the extremely rich. Early adopters also tend to be incentivised by cut-throat competition to look beyond the status quo. As such, there may be no group more likely to pick up new tools than the uber-rich and hyper-competitive hedge-fund industry. Your browser does not support the audio element.

You could become your own worst enemy. CEOs and other managers are increasingly under the microscope as some investors use artificial intelligence to learn and analyze their language patterns and tone, opening up a new frontier of opportunities to slip up. In late 2020, according to language pattern software specialist Evan Schnidman, some executives in the IT industry were playing down the possibility of semiconductor chip shortages while discussing supply-chain disruptions. All was fine, they said. Yet the tone of their speech showed high levels of uncertainty, according to an algorithmic analysis designed to spot hidden clues in -- ideally unscripted -- spoken words. "We found that IT sector executives' tone was inconsistent with the positive textual sentiment of their remarks," said Schnidman, who advises two fintech companies behind the analysis.

Natural language processing (NLP) increasingly popular Investors seek edge in world of'unstructured data' But CEOs are cottoning on, with more speech scripted Investors seek edge in world of'unstructured data' LONDON, Oct 20 (Reuters) - Executives, beware! You could become your own worst enemy. CEOs and other managers are increasingly under the microscope as some investors use artificial intelligence to learn and analyse their language patterns and tone, opening up a new frontier of opportunities to slip up. In late 2020, according to language pattern software specialist Evan Schnidman, some executives in the IT industry were playing down the possibility of semiconductor chip shortages while discussing supply-chain disruptions. All was fine, they said.

LONDON (Reuters) - Executives, beware! You could become your own worst enemy. CEOs and other managers are increasingly under the microscope as some investors use artificial intelligence to learn and analyse their language patterns and tone, opening up a new frontier of opportunities to slip up. In late 2020, according to language pattern software specialist Evan Schnidman, some executives in the IT industry were playing down the possibility of semiconductor chip shortages while discussing supply-chain disruptions. All was fine, they said.

It was AI versus Warren Buffett. The artificial intelligence was unleashed by Winton, the London hedge fund, to test an old principle of the Berkshire Hathaway Inc. chairman with a view to trading on it: that major acquisitions usually hurt the buyers' shareholders. Researchers collected and analyzed data on almost 9,000 U.S. deals back to the 1960s. Winton says Buffett's thesis doesn't hold up -- big acquisitions don't inherently destroy value. "It prevented us from trading on a false signal and potentially losing money," said Daniel Mitchell, who runs a team of data scientists at the $30 billion hedge fund.

It was AI versus Warren Buffett. The artificial intelligence was unleashed by Winton, the London hedge fund, to test an old principle of the Berkshire Hathaway Inc. chairman with a view to trading on it: that major acquisitions usually hurt the buyers' shareholders. Researchers collected and analyzed data on almost 9,000 U.S. deals back to the 1960s. Winton says Buffett's thesis doesn't hold up -- big acquisitions don't inherently destroy value. "It prevented us from trading on a false signal and potentially losing money," said Daniel Mitchell, who runs a team of data scientists at the $30 billion hedge fund.

The humans have all gone home. But the computers are just waking up. Man runs about $43 billion in assets through quantitative trading. Algorithms do most of the work, with people writing the code to build them and monitor for any anomalies after the fact. The machines are trading about 21.5 hours per day, from the open of the Asian markets to the close in the U.S. It's a strategy the firm has been utilizing for 30 years.

When something is working (especially profitable trades) don't ask why, just trade bigger. Seems like Man Group (a $96 billion dollar hedge fund) created an artificial intelligence (AI) program that worked so well that alpha just rolled in. Problem; they didn't know how the'robot' worked and made the trades it did. Memo to Man Group; when explaining the strategy the word is PROPRIETARY. And say it with authority.

As chief executive officer of one of the world's largest hedge funds, Luke Ellis prides himself on a healthy appetite for risk. "My job," he says, "is to not blink." About five years ago, he did, though--in a big way. What spooked him was an experiment at his firm, Man Group Plc. Engineers at the company's technology-centric AHL unit had been dabbling with artificial intelligence--a buzzy, albeit not widely used, technology at the time. The system they built evolved autonomously, finding moneymaking strategies humans had missed. The results were startlingly good, and now Ellis and fellow executives needed to figure out their next move. Man Group, which has about $96 billion under management, typically takes its most promising ideas from testing to trading real money within weeks. In the fast-moving world of modern finance, an edge today can be gone tomorrow.

Artificial intelligence (AI) will have a significant and complementary role to play in asset management going forward, according to investing guru, Man Group's Pierre Lagrange. "It's all about seeing how far we can push the machine in terms of taking some of the decision-making on the investment side. There are so many variables that people are looking at to be aggregated into the decision-making so the more you can use a machine, the better it is," explained Lagrange, speaking to CNBC on Tuesday. Lagrange co-founded discretionary asset fund manager GLG in 1995 and stayed with the firm following its 2010 acquisition for $1.6 billion by the world's largest publicly traded hedge fund, Man Group.