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BlackRock Bets Big on Power of Machines

Image: BlackRock Bets Big on Power of Machines
BlackRock Inc. CEO Laurence Fink (AP)

By    |   Tuesday, 28 Mar 2017 10:39 PM

Money management giant BlackRock on Tuesday laid out an ambitious plan to consolidate a large number of mutual funds and turn them over to peers who will rely more on computers to buy and sell stocks, the New York Times reports.

"The democratization of information has made it much harder for active management," Laurence Fink, a founder and CEO of BlackRock, told the Times. "We have to change the ecosystem — that means relying more on big data, artificial intelligence, factors and models within quant and traditional investment strategies."

The rollout is, according to the Times, "the most explicit action by a major fund management firm in reaction to the exodus of investors from actively managed stock funds to cheaper funds that track every variety of index and investment theme."

Seven stock pickers are expected to step down from their funds as part of the restructuring, the Times reports, and about $30 billion in assets will be targeted.

The approach relies more on algorithms, science and data-reliant models where managers might buy or sell a stock (like Walmart) "on the basis of a satellite feed that reveals how many cars are in its parking lots as opposed to an insight gleaned from the innards of the retailer’s balance sheet."

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Money management giant BlackRock on Tuesday laid out an ambitious plan to consolidate a large number of mutual funds and turn them over to peers who will rely more on computers to buy and sell stocks, the New York Times reports.
blackrock, computers, buy, sell, stocks
208
2017-39-28
Tuesday, 28 Mar 2017 10:39 PM
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