Just after Elon Musk shared his private thoughts on the roles of AI in the future (he basically suggested war), a Japanese hedge fund manager revealed that his creation has in fact made him some money.

Yoshinori Nomura spent three years refining his trading program, which now oversees about 3.5 billion yen (R476 million) in the fund, and is one of the first in Japan to utilise artificial intelligence technology.

Here’s his story, thanks to Bloomberg:

It was the hedge fund manager’s self-learning computer program that had placed the bet, selling Japanese stock-index futures before a sizable market advance. Nomura had anticipated a rally, but decided not to interfere, and his fund was paying the price.

Then, in an instant, everything changed. When new vote counts signaled Britain was going to leave the European Union, a burst of selling sent Japanese shares to their biggest drop in five years. By luck or design, Nomura’s Simplex Equity Futures Strategy Fund ended the day with a 3.4 percent gain, one of its best results in three months of trading.

There aren’t many of these programs used by financial management companies around the world, yet Nomura’s is especially interesting because of the market it is basing its trajectories on:

The 43-year-old money manager is setting his software loose in one of the planet’s most turbulent markets. Share-price swings in Japan rank No. 1 among the world’s 15 largest stock venues, with volatility readings almost four times higher than in the U.S. The benchmark Topix index has tumbled 16 percent this year, following an almost 10 percent rally in 2015. It climbed 0.6 percent on Monday.

As suggested by people in the know, the self-learning programs will need to prove themselves over a longer period of time before bigger companies take them seriously. But just how does Nomura’s program work? You can read all about the details over at Bloomberg – they have graphs, too.

Us? We’ll stick with the humans who know what they’re doing to help us grow our wealth.

[source:bloomberg]