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Why D-Street Is Tapping Into AI & ML To Improve Stock Market Functioning


Why D-Street Is Tapping Into AI & ML To Improve Stock Market Functioning


The usability of AI and machine learning has transcended all boundaries and its use-cases are not just limited to the tech sector. India’s leading  stock exchange, Bombay Stock Exchange (BSE) is one such organisation that has been incorporating the latest technologies for their smooth functioning.



BSE is known to use emerging technologies like AI and machine learning. In 2017, the stock exchange partnered with Switzerland-based data analysis company, Sentifi for using their AI-based data analysis tools for getting real time updates from social media from over 40,000 assets, currencies and commodities around the world.

Sentify’s algorithmic real-time data analysis tool was tasked to process billions of messages relevant for the financial markets and provide key information on ranking of stocks, drive comparison of market attention and stock price over time, most relevant and influential voices to each stock in Tweets, news and blogs etc.

Further, machine learning and deep learning algorithms were also used to rank and profile sources for financial market relevance thus, providing real-time data available 24/7 on the BSE site and Sentifi platform.

“The primary objective is to filter out the noise and get to the most relevant messages to the investors or readers. This collaboration will be a one stop solution for accessing all companies’ information reporting social media updates” said Ashishkumar Chauhan,  CEO and MD, BSE, in a press-release.

Earlier that year, both BSE and National Stock Exchange approached the Securities and Exchange Board of India (SEBI), the regulator for securities market in India to mull using AI and ML for creating a data-repository services and sought permission for the formation of a separate entity to handle the business, which is currently beyond SEBI’s perview.

 

Chatbots for processing information

In August 2018, in order to provide small and retail investors information from the stock exchange’s website, an AI-powered chatbot, Ask Motabhai, was developed using ShepHertz Applied AI Services on Microsoft’s Artificial Intelligence platform.

The stock exchange's website is known to provide real-time information on stock price, corporate results and announcements to over 5,000 listed companies and by leveraging the chatbot, it aimed to process information quicker and precisely.

“BSE has introduced an AI based chatbot “Ask Motabhai” which can have a text-based conversation with the user and mine the BSE website to give customized information. The ‘chatbot’ has been built using the Microsoft Bot Framework, Cognitive Services, QnA Maker and Language Understanding Intelligent Service on Microsoft Azure cloud,” Microsoft said in a press release.  It also stated that the chatbots can have text-based conversation with the users and mine it’s website to give customised information to the users.

“The ‘chatbot’ has been built using the Microsoft Bot Framework, Cognitive Services, QnA Maker and Language Understanding Intelligent Service on Microsoft Azure cloud,” it added.

“Our goal is to amplify human ingenuity with intelligent technology by infusing AI in everything we do. We provide a powerful platform of AI services and tools that makes innovation by our developers and partners faster and more accessible.  We are delighted to be partnering with BSE in its vision to emerge as a premier stock exchange with best global practices in technology, product innovation and customer service,” remarked Rajiv Sodhi, General Manager – Partner Ecosystem, Microsoft India about the development.

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Regulatory compliance for safe usage of AI

Unlike many other institutions that fail to adopt a strong AI-policy which can regulate the operation of AI and ML, BSE on April took a firm stance on the matter regarding the usage of these technologies by stock brokers.

In order to monitor the activities of such players and to ensure compliance with the existing cyber security framework as stated by the SEBI, the BSE asked the stock brokers to submit a compliance report from January-March 2019 before April 15. According to the security regulator, the move was taken to check for the safety measure that these entities have taken to prevent any abnormal behaviour of the system.

Stock brokers, firms and other stakeholders involved in the field are known to extensively use technology for helping customers make investment decision, numbers related to listed companies and for driving personalisation and even for trading purposes.

In addition to starting a new venture, last year BSE announced that it will allow for the listing of startups in a new platform, this will also include ventures which are concentrated in the field of artificial intelligence

 



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