{"id":933964,"date":"2026-10-15T13:04:23","date_gmt":"2026-10-15T13:04:23","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/933964\/"},"modified":"2026-10-15T13:04:23","modified_gmt":"2026-10-15T13:04:23","slug":"ai-powered-stock-funds-believe-bots-can-outperform-humans","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/933964\/","title":{"rendered":"AI-powered stock funds believe bots can outperform humans"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

The performance of the handful of funds that rely solely on AI to generate returns shows they are beating the market.Andrew Kelly\/Reuters<\/p>\n

A handful of fund managers are betting that exchange traded funds run by AI<\/a> stock-picking models can crunch data quicker and make better investment decisions than humans, even as many people remain wary or even fearful of artificial intelligence.<\/p>\n

So far, fewer than half-a-dozen ETFs, collectively managing only about US$30-million of the ETF industry\u2019s nearly US$17-trillion in assets, rely solely on AI-powered bots to control everything from research to stock selection.<\/p>\n

While that represents a tiny fraction of the industry, AI is making its way slowly and steadily into the investment processes of most asset managers, to some extent, even if that may not yet be visible to investors themselves. Earlier this year, 91 per cent of asset managers surveyed by Mercer reported plans to increase their use of AI-based portfolio management tools this year and said they are trying to figure out what tasks can be safely handed off to AI.<\/p>\n

The performance of the handful of funds that rely solely on AI to generate returns shows they are beating the market, even if their track records stretch back only a few months. Their managers argue these returns will attract more investments into the idea over time.<\/p>\n

Why governments might secretly wish for an AI stumble<\/a><\/p>\n

\u201cUntil now you\u2019ve had two choices: be a passive investor and own an index, or be an active investor\u201d with a human picking stocks, said Tal Schwartz, founder and CEO of Ai Funds. \u201cI want to offer a third option: where it\u2019s AI that is doing it all for you.\u201d<\/p>\n

In August, Schwartz launched the High Conviction US Equity AI-Managed ETF, built on a proprietary AI learning algorithm that analyzes decades of market data. So far, it has attracted less than US$20-million in assets, according to data from ETF.com, but Schwartz said it is still early days.<\/p>\n

AI can crunch more data more rapidly than any human being, he said, and strips human emotions and cognitive biases out of the investment process.<\/p>\n

\u201cI know this is a long-term process, that people will only become convinced over time,\u201d he added. \u201cI think that what will convince them is performance.\u201d<\/p>\n

Schwartz\u2019s fund is up 2.7 per cent since its Aug. 21 launch, beating the 1.1 per cent gain for the S&P 500 index in the same time frame.<\/p>\n

Two funds launched by Israeli asset manager FinQ in February have handily beaten the 11.0 per cent gain by the S&P over that time frame. FinQ\u2019s dollar-neutral US Large-Cap AI-managed ETF has soared 25.35 per cent and the version of the ETF not offering a currency hedge is 23.98 per cent higher since inception.<\/p>\n

Two other funds, the Pacer S&P 500 3AI Top 100 ETF and the Pacer S&P World 3AI Top 100 ETF, are ahead 10.34 per cent and 10.33 per cent, respectively, since their launches in early May, compared to a gain of 5.8 per cent for the S&P 500.<\/p>\n

Nonetheless, advisers and analysts said the funds\u2019 short track records and above-average fees may limit investor interest.<\/p>\n

\u201cAdvisers are comfortable with AI that informs a decision and uneasy with AI that makes it,\u201d said Jeff Judge, a financial adviser at Chesapeake Financial Planners in Forest Hill, Maryland, adding his clients are not clamouring for this.<\/p>\n

\u201cProof that this approach works will really come down to who can thoughtfully manage risk and ride out a down market,\u201d said Todd Sohn, ETF analyst at Strategas.<\/p>\n

Other firms have rolled out \u201cAI-enhanced\u201d ETFs, which use AI to undertake quantitative analysis, analyze stocks or monitor risk. This cautious approach is more common, insiders said.<\/p>\n

\u201cWe\u2019ve been training models using AI for seven or eight years now, and using them to run live capital for about four years,\u201d said David Wright, head of quantitative investments at Pictet Asset Management in Geneva.<\/p>\n

His firm launched the Pictet AI Enhanced US Equity ETF in February. Since its debut, the fund has attracted US$163-million in assets and posted gains of 14.8 per cent, compared to 11.4 per cent for the S&P 500.<\/p>\n

Wright compares using AI in the investment process to using a plane\u2019s autopilot functions. The autopilot may be able to take off, cruise and land with no humans involved, but, he added, \u201cI wouldn\u2019t go on a plane that didn\u2019t have a pilot.\u201d<\/p>\n

Other asset managers are taking a similarly cautious approach to integrating AI.<\/p>\n

\u201cI\u2019m not losing any sleep over robots ending the world,\u201d said Dan Taylor, deputy chief investment officer of systematic within Man Group, referring to recent headlines. \u201cBut I still do worry about AI\u2019s ability to deal with the most extreme, unlikely events, where all the action happens, both good and bad.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: The performance of the handful of funds that rely solely on AI to…\n","protected":false},"author":2,"featured_media":933965,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[62,901,276,277,888,902,879,877,903,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-933964","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-alberta","tag-artificial-intelligence","tag-artificialintelligence","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/933964","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=933964"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/933964\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/933965"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=933964"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=933964"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=933964"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}