Artificial intelligence could help enhance income from pensions, according to a new report*. Though algorithms have been used for some years in foreign exchange and equity trading, AI may go further and deeper, it says, providing “the ability for fund managers to analyse reams of data from a wide variety of sources”. It can “identify patterns and discover market sentiment or signals and thereby suggest future opportunities for investment that may go beyond the traditional or expected. This can lead to improved asset allocation and/or better diversification, resulting in higher long term returns and lower volatility”. And it may help individual investors ensure their investments are in line with their ethical preferences.
*Mercer CFA Institute Global Pension Index