Paperjam attended the “How to integrate AI in investment?” panel at the Luxembourg Investment Forum organised by Indosuez at the Luxembourg Chamber of Commerce on 11 October 2024. Pictured: Moderator Vincent Manuel (Indosuez Wealth Management Europe), Jonathan Ham (Indosuez Wealth Management, Luxembourg), Réza Malekzadeh (General Partner Partech) and Aurélien Duval (DPAM). Photo: Sylvain Barrette/Maison Moderne

Paperjam attended the “How to integrate AI in investment?” panel at the Luxembourg Investment Forum organised by Indosuez at the Luxembourg Chamber of Commerce on 11 October 2024. Pictured: Moderator Vincent Manuel (Indosuez Wealth Management Europe), Jonathan Ham (Indosuez Wealth Management, Luxembourg), Réza Malekzadeh (General Partner Partech) and Aurélien Duval (DPAM).  Photo: Sylvain Barrette/Maison Moderne

Panellists discussed how AI is used at an asset manager to gain efficiencies in daily tasks and to summarise vast amount of data to improve investment decisions during a recent industry conference.

Following the last Nvidia conference that lasted about one and a half hours where analysts asked several technical questions, Jonathan Ham, advisor at Indosuez Wealth Management in Luxembourg commented that he sent clients a ChatGPT generated summary of the call. “A 30-second exercise instead of 40 minutes if I would have had to write it down.”

As for the usage of Microsoft Copilot to prioritise the review of his emails, he plans to use AI as a tool to be more efficient, Ham added at an Indosuez conference on 11 October 2024.

Investment decisions: the role of AI

To manage the deluge of data more efficiently, Vincent Manuel, deputy CEO at Indosuez Wealth Management Europe, specified that AI is mainly used through two approaches in his firm.

First, its navigator investment model launched in Luxembourg in 2016-2017 uses macro and micro data and market trends to make investment calls--to have a long position in stocks or not and which index--in the Indosuez Fund Navigator. For instance, he noted that the model identified strong momentum on the Indian market in the last two or three years.

Manuel admitted that running AI applications is somehow not in the DNA of portfolio managers’ culture. Yet there is a quick evolution on the intelligent use of data by the portfolio managers. Moreover, he stressed that the latter keeps control over investment decisions.

In addition to funds-based quantitative models, Aurélien Duval, equity fund manager at DPAM, also takes advantage of AI in funds driven by fundamental research. The tool will then be used to get explanations on the mechanics of certain technologies or at the competitive edges of companies in the fund.

Second, the use of AI helps to eliminate “psychological walls” whereby emotion bias tends to overcome rational decisions. To address the matter, Manuel commented that Indosuez has set up a portfolio scoring model that assesses whether companies are improving/deteriorating. It forces discussions that may not have been spontaneous for a portfolio manager “in love or not” with a stock.

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