This work in progress aims to explore ethical dilemmas connected to the use of Artificial Intelligence (AI) in financial portfolio management, and their managerial implications. In old school quantitative investing, portfolio allocation decisions are typically based on a well-defined investment strategy. Financial portfolio managers devise and apply investment strategies to maximize expected returns for customers’ portfolios. The introduction of AI-enhanced algorithms enables smart machines to automatically revise and update investment strategies, learning from the past. AI itself might produce significant effects on the gains and losses of the portfolio management strategies, raising ethical dilemmas connected with human versus machine responsibility, accountability, and risk. From the managerial point of view, a new dimension of performance measuring, competence evaluation and incentive allocation is required for managing AI software developers in this area. To explore such dilemmas, empirical evidence is drawn here from MDOTM, an innovative and successful young enterprise developing AI-driven investment strategies for financial markets.

Beccalli, E., Elliot, V., Virili, F., Artificial Intelligence and Ethics in Portfolio Management, in Agrifoglio, R., Lamboglia, R., Mancini, D., Ricciardi, F. (ed.), Digital Business Transformation, Springer Science and Business Media Deutschland GmbH, Heidelberg 2020: <<LECTURE NOTES IN INFORMATION SYSTEMS AND ORGANISATION>>, 38 19- 30. 10.1007/978-3-030-47355-6_2 [https://hdl.handle.net/10807/225022]

Artificial Intelligence and Ethics in Portfolio Management

Beccalli, Elena
Primo
Membro del Collaboration Group
;
Virili, Francesco
Ultimo
Membro del Collaboration Group
2020

Abstract

This work in progress aims to explore ethical dilemmas connected to the use of Artificial Intelligence (AI) in financial portfolio management, and their managerial implications. In old school quantitative investing, portfolio allocation decisions are typically based on a well-defined investment strategy. Financial portfolio managers devise and apply investment strategies to maximize expected returns for customers’ portfolios. The introduction of AI-enhanced algorithms enables smart machines to automatically revise and update investment strategies, learning from the past. AI itself might produce significant effects on the gains and losses of the portfolio management strategies, raising ethical dilemmas connected with human versus machine responsibility, accountability, and risk. From the managerial point of view, a new dimension of performance measuring, competence evaluation and incentive allocation is required for managing AI software developers in this area. To explore such dilemmas, empirical evidence is drawn here from MDOTM, an innovative and successful young enterprise developing AI-driven investment strategies for financial markets.
2020
Inglese
Digital Business Transformation
978-3-030-47354-9
Springer Science and Business Media Deutschland GmbH
38
Beccalli, E., Elliot, V., Virili, F., Artificial Intelligence and Ethics in Portfolio Management, in Agrifoglio, R., Lamboglia, R., Mancini, D., Ricciardi, F. (ed.), Digital Business Transformation, Springer Science and Business Media Deutschland GmbH, Heidelberg 2020: <<LECTURE NOTES IN INFORMATION SYSTEMS AND ORGANISATION>>, 38 19- 30. 10.1007/978-3-030-47355-6_2 [https://hdl.handle.net/10807/225022]
File in questo prodotto:
Non ci sono file associati a questo prodotto.

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10807/225022
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 2
  • ???jsp.display-item.citation.isi??? ND
social impact