Investing

Ron Insana’s new firm aims to bring AI-powered trade ideas to individual investors

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Traders work on the floor at the New York Stock Exchange on March 13, 2024.
Brendan McDermid | Reuters

A new company will try to crack the code of integrating artificial intelligence and investing, and it will be mostly focused on helping individual traders make buy and sell decisions.

The firm, called iFi AI, launches Wednesday. The company will use AI models to help generate projected returns for stocks over various time periods, according to Ron Insana, iFi AI CEO and CNBC senior analyst and commentator.

“It’s a big assist when you’re looking at making a decision on whether or not you want to buy a stock, and you get a forecasted rate of return that says it’s going to be up 3% in the next month,” Insana told CNBC. “There’s some comfort around the decision-making process, knowing also that there’s more data going into our forecast than any human can ingest in a given day.”

IBM’s watsonx powers the AI programs behind the new venture, incorporating fundamental news, technical analysis and other factors to make projections about where stocks are headed. The AI programs are already being used to help make decisions with $6 billion that is managed institutionally, Insana said.

There will be multiple levels and price points for iFi AI, with most aimed at self-directed traders and a top tier, with broader portfolio tools, built for financial advisors, according to Insana.

Using high technology in finance was common well before the latest wave of AI, but Insana said the new programs are more dynamic than the types of quantitative strategies that have long been used in hedge funds.

“The difference between quantitative analysis and AI-driven analysis is that AI learns and continues to learn and teach itself,” Insana said.

The new company will face competition from other AI-related startups and Wall Street giants in trying to marry the new technology with trading. For example, Morgan Stanley named its first head of AI earlier this month.

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