Understandable Artificial Intelligence

Overview

©2018 Economic Data Sciences

Working with Chinese-market ETF's, EDS tool analyzed the trade-offs in each of the funds


  • List of metrics shown in the videos are ones that we found to be the most interesting to clients
    • Additional quantitative/qualitative metrics can be used
  • The goal of the analysis was to understand whether the client was taking too much risk to achieve their expected returns

Balance Every Risk And Opportunity

©2018 Economic Data Sciences

The most powerful portion of our tool is the ability to balance every risk and opportunity - at the same time.


  • "What gets measured get managed"
    • Human capacity to keep track of everything is limited

    • Think of our A.I. as 'Optimization Unlimited'

    • Using this approach ensures to get the most from each trade-off

A Balancing Demonstration

©2018 Economic Data Sciences

We want to provide tools to your team that help them get the best from their insights


  • We keep track of everything behind the scenes while the team focuses on the area of opportunity or risk

  • A Chinese focused fund wants to be exposed to Chinese factors, but the tail risk associated with those can be high

  • We focus on examining two scenarios:
    • Controling exposure to Chinese Leading Indicators
    • Controlling Tail-Risk through Systemic Risk Exposure

  • We examing these across the return spectrum

Trade-offs Beyond Traditional Tools

©2018 Economic Data Sciences

Traditional Tools can only examine "strictly convex" trade-offs which is why they are limited to only a handful.

  • Reality doesn't fit this mold, and our tool breaks that constraint

*Data from EDS, Krane Funds, & Bloomberg, courtesy of London Business School

Additional Trade-Offs

©2018 Economic Data Sciences

Beyond summary statistics we can examine and decompose each individual factor/objective/trade-off.

  • This leads to more informed decision making and more control over risks

*Data from EDS, Krane Funds, & Bloomberg, courtesy of London Business School

Conclusion

©2018 Economic Data Sciences

We seek to add value to your process and team with an innovative and powerful suite of customized tools


  • Let your human team focus on more valuable work than data cleaning and search
    • Machine Learning can point them to new insights more efficiently

  • Combining models allows for a more complete view of risk
    • A deeper understanding of the connection between models

  • Keeping better balance
    • No human can keep track of everything, we believe A.I. can supplement the process and provide more informed decision making an

 

Disclaimers

©2018 Economic Data Sciences

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this presentation, will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for an individual's portfolio.

Our projections are based on current market conditions which can vary over the coming months and weeks. Additionally, our projections are based on historical market behavior which may vary unexpectedly. Using Machine Learning, our tool should adjust to new market fluctuations but we might not be able to avoid short term volatility.

Get In Touch

©2018 Economic Data Sciences

info@EconomicDataSciences.com

www.EconomicDataSciences.com

info@EconomicDataSciences.com

Evaluating trade-offs

By Economic Data Sciences

Evaluating trade-offs

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