Financial Analysts, Meet Skynet
They trade billions of dollars worth of instruments..why can't they do this?
Can an Algorithm Replace Stock Analysts?
Now the company says it doesn’t just want to do the job of business journalists, but also the work done by financial analysts.At yesterday’s demo day for the FinTech Innovation Lab, a New York-based program that matches tech startups with mentors from the banking industry, Narrative Science Chief Technology Officer Kris Hammond said the software could turn data into written reports for wealth management firms, institutional investors, and research shops. “The target is to take the best financial adviser or analyst and turn his skill set into something that the machine is doing,” Hammond says.
Are financial firms buying in? Convincing a newspaper to run a computer-generated sports story is one thing, but asking investors and advisers to trust machine-written language seems like a harder sell. Maybe not, says Hammond. One-third of Narrative Science’s 50 clients are in financial services—Hammond declined to name names—and the company is shifting its focus away from media and toward finance. (Narrative Science also raised venture capital recently from In-Q-Tel, which invests on behalf of the Central Intelligence Agency.)Wall Street already trusts computers to trade millions of dollars worth of securities on their own, so using an algorithm to put the numbers into words might not be a giant leap. Does that mean financial analysts should be as worried about their jobs as sportswriters? “We’ve had, I wouldn’t say zero, but close to zero pushback from analysts afraid of losing their jobs,” Hammond says. “Most of them see it as a way to spend their time working with the high end of their skill set and letting the machine take care of the lower end.”
http://www.businessweek.com/articles/2013-07-12/can-an-algorithm-replac…
This isn't going to harm analysts, at least the top ones. They don't really spend much of their time writing the actual reports; that's what the people junior to them in ER are for. A good analyst is one who knows more than numbers: has relationships with management, deep industry knowledge, and other intangibles that a computer isn't going to pick up from reading financial statements.
OMG! What will we do when it achieves consciousness.
What he said.
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