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HSBC launches first AI-powered equity index for China investors
Product uses artificial intelligence and big data to evaluate stocks in highly volatile markets
11 Nov 2020 | The Asset

HSBC China today (November 11) launched the AI Powered US Equity 5 Index (AiPEX5), becoming the first bank in China to offer an index-linked structured deposit product using artificial intelligence (AI) as a method for equity investing. It turns big data into investment insight by using AI to evaluate stocks with the aim of identifying international investment opportunities for individual investors in the country to grow their wealth.

AiPEX5, a part of the AiPEX family of indices, is the first and only rules-based equity strategies to use the artificial intelligence technology of IBM Watson. According to the bank, the index offers key advantages over traditional investment strategies. It leverages AI capabilities to process and learn from vast amounts of publicly available, continuously generated data points and turns the data into investment insight. Data points could include company announcements, news and tweets.

The index also uses a rules-based process to objectively evaluate publicly traded companies and rebalances its equity portfolio monthly. And to manage short-term volatility, it reallocates between the equity portfolio and cash component on a daily basis.

Richard Li, executive vice president and head of wealth and personal banking at HSBC China, comments: “Adoption of digital wealth and investment tools in China is accelerating at a faster pace than other markets globally. AI combined with big data equips investors with an innovative and more precise tool to navigate through increasingly volatile international markets. The take up of these new solutions is increasing among retail investors, especially millennials, seeking portfolio diversification.”

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