Check out how AI streamlines the ETF trading process
Horizons ETFs rolled out the first exchange-traded fund in Canada to use artificial intelligence for all security selection decisions.
Also the first global equity-focused ETF to use the said tech, the Horizons Active A.I. Global Equity ETF is pegged to provide an economical, actively managed exposure to global equity indices using North American ETFs. The fund will begin trading on Toronto Stock Exchange with the ticker symbol MIND.
Sub-advised by Mirae Asset Global Investments, the fund is employing an investment strategy known as Deep Neural Network Learning, a construct of artificial neural networks that enable AI system to identify patterns and decide at hyper-fast speeds.
Horizons president and co-CEO Steve Hawkins said the launch of MIND is another milestone for both Horizons and Mirae Asset as they strive to offer the ideal investment solutions through global collaborations.
Hawkins said the fund is expected to process market data and allocate assets more efficiently than any human manager.
"Unlike today’s portfolio managers who may be susceptible to investor biases such as overconfidence or cognitive dissonance, MIND is devoid of all emotion. It is purely systematic in how it makes investment decisions," he explained.
MIND monitors more than 50 investment metrics in analysing patterns and making investment decisions. Additionally, MIND rebalances its assets monthly to allow the AI more flexibility around the investment allocation process.
Hawkins stated that having an AI system as an active manager significantly streamlines the process, making it easier for investors to buy ETFs.
“Despite Canadian investors slowly overcoming their home bias and wanting to invest in international markets, the expertise required for a global strategy can be costly and time-consuming for the average investor to pursue,” he said.
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