AI transforms capital markets

Fintech is making the once-arcane world of high finance much more accessible to regular investors.

As it continues to make inroads in every part of the financial industry, fintech is making capital markets more accessible and transparent, reports the International Business Times.


“Artificial intelligence is really coming into play, cutting out the middleman,” Mariel Ebrahimi, CEO and co-founder of DisruptCRE, told IBT. “Folks are able to analyze deals on their own. People are turning to crowdfunding instead of going to a traditional bank or mortgage broker.”


Through certain crowdfunding platforms, an investor with only $1,000 can now directly participate in billion-dollar real estate deals – something that was reserved until now to giant investment funds. According to Forbes, the real estate crowdfunding industry is set to grow to US$300 billion by 2025.


One unexpected area where crowdfunding is taking off is in the “fix and flips” segment of real estate, where people can buy property, increase its value by fixing it up, then sell for a profit, says Ebrahimi.


Artificial intelligence will be a key driver in the whole fintech revolution. Just as Amazon has AI agents sifting through a client’s past purchases and suggesting new ones, AI advisers will sift through mountains of opportunities and recommend investments that correspond with an investor’s portfolio. Credifi, a startup proposing such a service, has just raised US$13 million.


AI is already enhancing market surveillance at Nasdaq, which has partnered with cognitive computing company Digital Reasoning. “You can take data from different sources and create new data and new intelligence,” said IBT Lars Ottersgard, NASDAQ’s head of market technology. The system that processes natural language can even listen to chatter about deals, helping spot players trying to cheat the markets.


The perennial question remains unanswered for the time being: will fintech and AI vandalize jobs? One specialist sees AI stock trading replacing trading jobs within a decade. Ottersgard disagrees, saying that only some traditional jobs will fade away. One thing is certain: there are already plenty of job openings for data scientists and AI programmers in the financial industry.