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
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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
Get In Touch
©2018 Economic Data Sciences
info@EconomicDataSciences.com
info@EconomicDataSciences.com