Nomura’s Head of Digital Warns of AI’s Predictive Limitations

The investment bank’s deputy chief digital officer says machines cannot predict markets, as the bank consolidates trading operations and builds an AI trading platform for fixed income and FX.

Predicting losses

Could AI predict market movements? 

Matthew Hampson, deputy chief digital officer at Nomura, is not convinced that this will ever happen, as he warns of the technology’s limitations.

“The market is stochastic. It has a level of randomness that is challenging to model,” Hampson says. “It’s not like it’s a turbine failure, or the way retail shoppers buy food, or whether you’re going to develop an illness. Those areas are based on physics or biology, and [therefore] statistical models work well

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