Can AI and a supercomputer beat the markets?

T

Tiney Winey

Can AI and a supercomputer beat the markets?

I don't know about "beat".... but I suspect in less than a decade's time, the intraday volatility that we all enjoy now across any basket of stocks, futures, or indexes, .... is gonna go away.

The 4 or 5 powerhouses out there, Bridgewater, Citadel, Man, Renaissance, etc..... don't think they aren't in an all out AI spending frenzy right now. And that money being spent isn't to beat retail traders, it's being spent to beat each other. The game gets tighter and tighter, and outside of a few one off occurrences... it gets closer and closer to a stalemate.

The volatility curve is going to flatten... it has to if one considers the power of AI being forecast. And outside of that, the only way retail will make any money is by going back to the basics... the Peter Lynch stuff. And it won't be retail "traders" making any money, because they'll become a dying breed. It'll be those that buy stocks for the real reason they ever came into existence in the first place. Take a teeny tiny ownership stake in a company you think is growing by throwing in as much as you can afford, think long term, and go about your daily paycheck to paycheck existence banking on a retirement that will hopefully come in if your FA homework was right. The writing is on the wall for anyone with enough foresight to see it.
~vz
 
Only 10% of the traders/investors make it.

Similarly, not all AIs can make it.

Some AIs might suffer from
mental breakdowns, or
go crazy.

They might
do revenge trade, or
do average down, or
do kamikaze / countertrend trading
....

like what humans with EMOTIONS are doing.
 
vanzandt said:
I don't know about "beat".... but I suspect in less than a decade's time, the intraday volatility that we all enjoy now across any basket of stocks, futures, or indexes, .... is gonna go away.
More...
Or that the entire financial market will be extinct after this...

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Tiney Winey said:
"A former investment banker with little previous quantitative-trading experience, Valois-Franklin claimed that Wallace's main selling point over rival AI-powered hedge funds
More...

"Castle Ridge's chief scientific officer, Alex Bogdan...."

Alex, in case no one noticed, is ET's own Maestro.

As Destriero pointed out in an earlier post, Castle Ridge, after getting off to a pretty good start, has taken a big hit in the last couple of years, and has hemorrhaged AUM.
 
How can a LLM ai approach beat the market? Any example?
I can see how it could be used in chats, voice calls, prospectuses, rfqs, providing color, summaries,..
 
Renaissance Technologies and Jim Simons has been doing it for a while now, using algorithms to beat the US stockmarket. It is highly likely, they are using super computers to crunch the numbers, as their models are based on mathematical algorithms.
 
smallfil said:
Renaissance Technologies and Jim Simons has been doing it for a while now, using algorithms to beat the US stockmarket. It is highly likely, they are using super computers to crunch the numbers, as their models are based on mathematical algorithms.
More...
is that AI? do mathematical algorithms need a super computer?
 
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