1) On a scale of 1-10, how would you rate Wall Street’s adoption of AI (with 10 being “We’ve reached peak AI”) and why do you say that?
Lane Mendelsohn: I think we’re probably at about a 3. I think a lot of people at this point are hearing more and more about artificial intelligence, becoming a little bit more familiar with what it is, but being familiar with something and actually being able to implement something are two very different things.
We saw back in the early 1990’s, neural networks and artificial intelligence were becoming a hot topic. A lot of individuals were starting to experiment with them, a lot of companies were trying to utilize them, and it’s a tool and it really depends on how the tool is being implemented. I think probably in the next five years, we’ll get to a five. I think it’s going to be a while before we get to a 10 on the scale of adoption.
2) What is currently the biggest challenge for institutional investors in how they use, or try to use, AI?
Lane Mendelsohn: I think for a lot of institutional investors, it’s going to be very difficult for them to figure out exactly 1) what do they want the AI to do for them? And then I think the bigger challenge is going to be how do they implement it? Because you can’t just wake up one day and decide you want to implement artificial intelligence.
For our company, we’ve been developing artificial intelligence technology since the 1980’s, and we still haven’t perfected it. Now, we’ve gotten to a point where we can successfully and consistently generate forecasts that are in the 86 percent range, but it’s an ongoing process and the markets are constantly changing. It’s something that has to be an ongoing effort, which requires a lot of talent but also a lot of financial resources in order to refine and continue to perfect that technology.
3) What is currently the biggest challenge for retail investors in how they use, or try to use, AI?
Lane Mendelsohn: I think the challenge for retail investors is everything that relates to institutional investors, but multiplied by 1,000x. For retail investors, they don’t have the financial resources that institutional investors have, and they don’t have the time to spend on it. Everything that I mentioned as it relates to institutional investors and the challenges that they have, it’s all magnified when it’s related to retail investors and traders.
4) How far ahead or behind is Wall Street in implementing AI compared to other major industries?
Lane Mendelsohn: I think Wall Street is behind other major industries. I think the healthcare industry has really adopted artificial intelligence and has made some great strides. I know that a lot of telephone companies and customer service-based companies are using AI to help them reduce hold times and get answers to questions that people have much more quickly. A lot of other industries have had an easier time figuring out what the problem is and how AI can solve that problem, and then the implementation is much easier.
5) What’s the biggest challenge that AI will cause for regulators?
Lane Mendelsohn: I don’t really know how artificial intelligence will be a challenge for regulators. I think that’s just something that we’ll have to wait and see how AI continues to develop and change the world specifically related to trading and investing before we’ll know how that will affect or be a challenge for regulators.
6) Will the adoption of AI lead to a reduction in volatility?
Lane Mendelsohn: I don’t think that the adoption of AI will lead to a reduction of market volatility. I think the markets are always going to be volatile, and we need volatility. Volatility is actually a good thing for the markets. It creates tremendous trading opportunities for people to really build wealth.
The key is the AI, and this is something that we’ve successfully been able to do for decades now, is the AI can help traders navigate the market volatility. And that’s really what we’re looking for. If there was no volatility, then there’s not really much in the way of trading opportunities. If there’s volatility, that creates trading opportunities, but the only people that will be able to seize those opportunities and profit from them are those who have a way of navigating that market volatility and putting the odds in their favor. That’s how VantagePoint has helped our customers utilize artificial intelligence to do just that.
Six Experts Discuss How AI Will Change The Future Of Wall Street
Lane Mendelsohn, Vice President of artificial intelligence (AI) forecasting software VantagePoint, says in a Benzinga expert panel that Wall Street will catch up with other sectors in adopting AI to solve problems and create wealth. VantagePoint, capable of forecasting stock market trends up to three days in advance with up to 86% accuracy, was asked to participate in discussions on how investors and AI can more effectively intersect to create opportunity.
“There is some limited understanding of AI among retail and institutional investors, but actually being able to implement it to solve problems and create opportunities is the real challenge,” Mendelsohn said. “With nearly forty years of using AI to forecast markets, VantagePoint leads the way in enabling investors to cull vast amounts of data, pinpoint intermarket relativity, and make informed decisions based on predictions that supersede human capability.”
The round table discussion, organized by Benzinga and available in two parts on their website, provides Mendelsohn’s perspective on Wall Street’s current and future use of AI, challenges for regulators, and whether AI will lead to a reduction in volatility. Mendelsohn was joined by five other AI experts.
“It’s our job at VantagePoint – and something we think about every single day – to continuously discover ways AI can solve the problems and unknowns our investors face,” Mendelsohn said. “Because AI-based indicators must be trained and refined to keep up with the ever-changing financial markets, we invest heavily in research and development, and we know Wall Street is paying attention now.”
Since the 1980s, VantagePoint Software has released several significant updates to achieve 86% forecasting accuracy which is proven in many VantagePoint software reviews. During February’s record 1,200+ point Dow drop, VantagePoint’s version 10 proprietary intermarket indicators used its global approach to warn customers five days in advance.
A free VantagePoint demo is available at https://www.vantagepointsoftware.com/demo/ or by calling 800-732-5407.