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Why do traders in investment banks feel their jobs are immune from AI, etc?

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41–50 of 232 posts

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#41
post #9

HN title is significantly different than the question the submission actually asks which is "why do TRADERS in investment banks . . . " and should be updated

My 2 cents:

The job is actually extremely complicated. I wear many hats daily including working as a software developer, IT project manager/architect, salesman to clients, point of contact to other institutions trading desks, legal drafter, tax/accounting policy design, deal negotiator, risk taker/manager, systematic/fundamental strategy research etc. My job title is "Trader". There aren't any dumb big swinging dick 80/90's style traders left shouting buy and sell (if they are it's purely relationships and at small shops). Nearly everyone on my desk has a CS degree or similar quant background.

AI/deep learning is currently nowhere near being able to master one of these fields let alone cohesively manage all together in a direction to actually make money (just pay a "trader" a 200k-1.5mn USD a year its much easier). Most grunt work is automated and most outfits do in fact make use of statistical methods/classifiers/predictors and differentiable networks where appropriate. At the crux of it someone needs to manage, design the systems and fill in for them with a bit of intuition and common sense where there are gaps. The world is a chaotic place and its not getting simpler. Machines are not robust against chaos.

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#42

The last few minutes of this documentary on Long Term Capital Management and its algorithmic failure will tell you why: https://vimeo.com/28554862

The complete lack of any sign of remorse on their faces about having burned a trillion dollars made the hair on the back of my neck stand up. I've never seen such a blatant display of psychopathy.

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#43
post #32
post #14

Earlier quoted context omitted.

> Nobody is suggesting AI will replace salespeople in the near future. Huh? For one, investment bankers are "just salespeople" in the same way doctors are just nurses. Second, everybody and their mother is suggesting AI will replace retail level salespeople in the future. In fact lots of places, from British supermarkerts (where you can bill and pay for your purchases yourself), to Amazon's Go experiment, and numerou…

Cashiers aren't salespeople. Salespeople are people who convince you to buy something. Higher-end stores have them, grocery stores do not.

> Salespeople are people who convince you to buy something. Higher-end stores have them

Many more lower-end stores did too, pre- or earlier in Amazon's and online shopping's proliferation. It's already happened to a not insignificant extent.

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#44

> "Would you trust purchasing a house from a seller, without meeting/talking to them, or a single person before and throughout the purchase?" You mean I can get an unbiased look at a house in peace, compare the numbers, look at the plans, measure the humidity and do my due diligence without a sales person breathing down my neck? Hell yea. I'd pay premium for that.

I did exactly this when buying my home through Redfin. I only met the selling agent in person because they unlocked the door so I could see inside. The rest was though email mostly.

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#45
post #32
post #14

Earlier quoted context omitted.

> Nobody is suggesting AI will replace salespeople in the near future. Huh? For one, investment bankers are "just salespeople" in the same way doctors are just nurses. Second, everybody and their mother is suggesting AI will replace retail level salespeople in the future. In fact lots of places, from British supermarkerts (where you can bill and pay for your purchases yourself), to Amazon's Go experiment, and numerou…

Cashiers aren't salespeople. Salespeople are people who convince you to buy something. Higher-end stores have them, grocery stores do not.

Well, in that case, travel agents have been replaced by "buy your own tickets online", real estate and rental agents have seen similar automation through web apps (+ reviews, photos, walkthroughs, etc for the "convincing part"), and lots of other salespeople jobs.

Bookstores is probably a famous example, where the people working there were far more than cashiers, but they still got decimated by Amazon and co.

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#46
post #37

>No amount or greater sophistication of the algorithmic structures listed above, can replace genuine human nuance, interaction and trust. I don't think this is true. Not at all.

I think there is a technical and experiential aspect to these 3 elements. I think the technical aspect can be met, but perhaps it's equally true that the experience of trust etc with another human can not be replaced (in a literal sense, given that it specifically requires a human).

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#48
post #37

>No amount or greater sophistication of the algorithmic structures listed above, can replace genuine human nuance, interaction and trust. I don't think this is true. Not at all.

Me neither. How much of the genuine human nuance is present in today's financial services or any commission driven industry - next to nothing. Every agent/broker is motivated by the highest commission he/she can make, nothing more.

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#49

Everybody feels their job is safe from automation. Its the same way planes crash but not mine . Believing "I am special", is just built into us.

Not only do I believe that my job can be automated - I've spent years trying to do just that.

Of course, I wouldn't be giving the scripts to my employer, just spending more time doing other things...

Re: Why do traders in investment banks feel their jobs are immune from AI, etc?

#50

> "Would you trust purchasing a house from a seller, without meeting/talking to them, or a single person before and throughout the purchase?" You mean I can get an unbiased look at a house in peace, compare the numbers, look at the plans, measure the humidity and do my due diligence without a sales person breathing down my neck? Hell yea. I'd pay premium for that.

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