Four Most Effective AI Solutions for Financial Trading

Four Most Effective AI Solutions for Financial Trading

It was not a long time ago when the efficiency of garnering market insights pertaining to stock trading was dependent on the level of experience, astuteness, and foresightedness of the individual. This dependency is increasingly ceasing to exist with the advent of artificial intelligence which is democratizing this capability. Machine learning in combination with fast data processing is allowing the assessment of huge data which is directly interpretable, and natural language processing (NLP) is extracting insights even from the conversations. From asset price prediction to investment strategy development, artificial intelligence is proving to be beneficial in every segment of financial trading.  

According to a global survey by Deloitte on the adoption of AI, 70 per cent of financial services firms have started using ML for predicting cash flow events and detecting fraud. There are several innovative AI solutions being developed for use cases related to financial trading. Using pattern recognition technology and price forecasting, it has become possible to zero in on the best performing stocks of the day. AI has given the capability to finance personnel to go through unstructured data and extract valuable insights in real time. For the investors, algorithmic trading strategies are being devised by data scientists, thus placing the power in the hands of the investor. The technology is also empowering the trading community to identify the best trading opportunities, wherein smart contracts are being used that are based on blockchain.         

Let us look at some of the best solutions available in the market. These solutions are capable of leveraging artificial intelligence effectively to transform trading.              

IBM: Workflow Automation for Trade Finance    

The conventional workflow of financial trading has a wide scope for automation, right from digitization of document to implementation of machine learning. IBM offers an integrated solution that is powered by IBM Cloud Paks which leverage hybrid cloud to infuse intelligent workflows in business processes, eventually leading to digital transformation. The software harnesses the power of IBM Watson to add the AI dimension to the business, enabling it to predict future outcomes and automates complex business processes. It also empowers employees to better utilize their time while at the same time making the customer experience more satisfying.      

LTI: Trade Finance Cognitive Automation    

For trading businesses and organizations, handling a plethora of documents is the order of the day. The complete process from information extraction to validation traverses a long path to complete the cycle. Expediting this process with accuracy and getting timely alerts can bring about considerable reduction in the turnaround time (TAT) and can steer the business clear of the pitfalls of non-compliance. LTI’s Trade Finance Cognitive Automation solution enables the same. Through its NLP capability, the solution accelerates the document verification process. The product-related entities are extracted from unstructured documents using the cognitive ability of the solution. It also conducts automated compliance checks to get timely alerts.       

NVIDIA: AI Solution for Finance  

NVIDEA combines the power of deep learning, machine learning, and NLP with remote work solutions to help the financial services sector overcome the pre-existing and the emerging challenges to technology adoption. By using its AI solution, financial service institutions can raise their capability of risk management, while being able to make better informed decisions backed by data. The solution also helps institutions improve their customer experience. As the solution accelerates computing for trading, a direct result of the same is smarter trade strategies which evidently lead to higher revenue. The company’s GPU-powered hardware brings down the time to reach the actionable insight, thus keeping the operations at par with the competition.         

Datamatics: Smart Business Accelerator      

The perennial challenges in financial trading remain the same – going beyond siloed manual systems and being on top of compliance management and control. The trade finance solution offered by Datamatics acts as a business accelerator. Available in both cloud-based and on-premise model, the solution automates the trade lifecycle and becomes an integral part of the customer’s core trade finance system. This is again powered by IBM Cloud Pak for Business Automation and leverages technologies like Intelligent Data Capture, AI/ML, and RPA. Through the solution, the company claims to bring about 33 per cent reduction in processing time, among other benefits.   

“From capital markets to consumer finance to fintechs, AI is powering the future of finance. Traders are using AI and high-performance computing (HPC) to accelerate algorithmic trading and backtesting, while meeting industry regulations through explainable models,” says Kevin Levitt, Global Business Development, Financial Services, NVIDIA. Several other industry experts are of similar opinion when it comes to adoption of AI in financial trading and in fact in financial services segment as a whole. Moving ahead, it is going to be interesting to see how this paradigm shift reshapes further and brings more use cases from this segment within its fold. It will completely change the outlook of both the financial service firms and the investors towards financial trading.