Media coverage
Guest article by Roger Hilty on artificial intelligence in the hedge fund space featured in Finanz und Wirtschaft
Finanz und Wirtschaft published a guest article by Roger Hilty, Partner at LGT Capital Partners, on how hedge funds use artificial intelligence (AI) to generate alpha. Developments in this segment are very dynamic and there are many new launches but also some AI hedge funds that have disappeared again from the market. Roger explains why diversification and the right manager selection are crucial for investors.
Unlike traditional quantitative hedge funds, AI-based hedge fund strategies are not based on predefined investment hypotheses. Instead, they analyze large data sets using algorithms to make trading decisions. These approaches are highly adaptable and can identify multi-dimensional, complex relationships in the market that go far beyond human cognitive abilities.
AI hedge funds’ biggest challenge is the limited transparency about how their trading signals are generated. For this reason, close communication with these hedge funds and a high level of portfolio transparency are crucial. Ideally, one should not invest in the fund directly but rather through so-called managed accounts. This provides a daily insight into the portfolios.
Read the article in German here.