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.

As more and more companies adopt artificial intelligence (AI) in their operations, investors may be considering AI stocks in the stock market. After all, AI remains to be an increasingly relevant area of research now. For the uninitiated, AI deals with machines that attempt to emulate human intelligence. Most of us may think of sentient robots and futuristic gadgets upon hearing the term. But in reality, AI often revolves around complex algorithms and software which enable enterprises to make more effective decisions.

FIFTY YEARS ago investing was a distinctly human affair. "People would have to take each other out, and dealers would entertain fund managers, and no one would know what the prices were," says Ray Dalio, who worked on the trading floor of the New York Stock Exchange (NYSE) in the early 1970s before founding Bridgewater Associates, now the world's largest hedge fund. Kenneth Jacobs, the boss of Lazard, an investment bank, remembers using a pocket calculator to analyse figures gleaned from company reports. His older colleagues used slide rules. Even by the 1980s "reading the Wall Street Journal on your way into work, a television on the trading floor and a ticker tape" offered a significant information advantage, recalls one investor. Since then the role humans play in trading has diminished rapidly. In their place have come computers, algorithms and passive managers--institutions which offer an index fund that holds a basket of shares to match the return of the stockmarket, or sectors of it, rather than trying to beat it (see chart 1).

THEY certainly cannot be faulted for a lack of ambition. The scientists and engineers who gathered this week in Oxford for the first International Workshop on Complex Agent-Based Dynamic Networks are seeking to explain much of the world's behaviour through the use of "agents". In this context, an agent is a program that acts in a self-interested manner in its dealings with numerous other agents inside a computer. This arrangement can mimic almost any interactive system: a stockmarket; a habitat; even a business supply-chain. If the constituent parts can be understood, the reasoning goes, some insight into the whole will follow.