AI will irrevocably shape the future of trading, according to a survey of 835 professional traders conducted by JPMorgan Chase and cited in an article in Bloomberg. Over half of those surveyed believe that the use of AI will expand across the commodities markets and into the credit and rates side. More and more hedge funds are “bringing systematic models optimized with machine learning to over-the-counter markets,” says Scott Wacker of JPMorgan, and asset managers are turning to “AI-enhanced technologies” to improve trading procedures.
After the release of ChatGPT in November of last year, more traders are beginning to see just how powerful AI technology can be and what its place should be in the workplace. Though some of those surveyed still consider AI a “catchword,” Wacker told Bloomberg, “People are amazed at what AI technology can achieve…it’s the beginning of a journey.” After AI, the technology that lets apps interface with each other—Application Programming Interface (API) integration—was seen as having the next largest impact on trading, with blockchain and distributed ledger technology coming in third. Blockchain is “a little further down the line,” says Wacker, though he fully expects its use to expand quickly.
But beyond AI, traders forecast that the risk of recession as well as inflation will influence the markets the most this year. And traders believe the toughest challenge they will face in their daily trading will be “Volatile Markets” as opposed to the liquidity concerns that have dominated the last several years. Meanwhile, other results from the JPMorgan survey showed that traders have lost their appetite for crypto, with 72% of respondents indicating they do not plan to trade crypto, the article notes.