Bank's AI tool identifies stock buys based on user's risk appetite

Trained on data from stock exchanges in three markets, the Singapore bank's AI platform predicts price movements and generates stock picks based on a user's personal risk profile and trading patterns.
Written by Eileen Yu, Senior Contributing Editor
Credit: OCBC

OCBC has introduced a stock picker tool powered by an artificial intelligence (AI) engine that is trained on data from stock exchanges across three global markets, including Hong Kong and the US. 

Called A.I. Oscar, the AI platform was trained with data from 4,000 stocks listed on the Singapore Stock Exchange, Hong Kong Exchange, NASDAQ, New York Stock Exchange, and NYSE American. The data spans more than 10 years' worth of stock fundamentals, macroeconomic factors, market patterns, and technical indicators related to the stocks, according to OCBC Securities, the brokerage subsidiary of Singapore bank OCBC. 

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The training data is updated daily to keep the AI platform current and continuously finetuned by OCBC's team of data scientists and trading strategists, who assess the latest AI modeling techniques to improve A.I. Oscar's prediction accuracy and market understanding, OCBC said. 

It added that the AI tool can predict stock price movements and generate stock picks based on the user's personal risk profile and trading patterns. This includes the investor's past trading activities and demographic data. 

The tool then analyzes the data to generate a list of 15 stocks each week, curated from exchanges in the three global markets, which are the top three in which OCBC Securities' customers trade. 

"This personalization allows investors to filter stocks that are highly likely to meet their trading preferences and criteria, and to immediately act on the idea by making a trade," the bank said. 

It added that the AI tool was first piloted based on Singapore stocks between last October and this April before it was expanded to include the US and Hong Kong markets.

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A.I. Oscar is offered as a free service for OCBC Securities' customers via the iOCBC mobile app, iOCBC online trading platform, and email.

The bank is hoping the launch will help triple the number of active customers aged under 35, over the next three years. Some 97% of all trades made by this customer segment last year were processed through digital platforms, bypassing advice or guidance from a human broker. 

In addition, young investors opened more than half of all new trading accounts in 2023, OCBC said, noting that A.I. Oscar is targeted as a tool for customers who lean toward self-directed investing. 

OCBC said that trading activities among investors aged under 35 climbed by 50% during the pilot, compared to the months before the trial last year.

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"Unlike rule-based models that make decisions based on a set of pre-determined criteria, A.I. Oscar identifies patterns in data to create dynamic prediction parameters," OCBC said. The platform is powered by deep learning algorithms that tap neural network models, the bank said. 

OCBC Securities' managing director Wilson said: "Investors already have access to a wide range of information, but the challenge lies in being able to find the information relevant to them and to distill it into an actionable trading idea. Being able to do so quickly is especially important in today's fast-paced world. A.I. Oscar addresses this need, and we expect it to become an indispensable tool, especially for digitally savvy young investors who prefer the self-service model."

The AI tool's ability to generate stock ideas also provides a starting point for discussions between the bank's trading agents and customers, he said. 

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