Novice AI users to cause risk and sell-offs: How to survive the next financial crisisSign up here for our free Roundtable Scripts - get this unique intelligence by email as Opalesque publishes them: With over 20 million inhabitants, Florida is the 3rd largest state in the US and its 2018 projected GDP of over $1 trillion ranks it as the 4th largest. The state has also the strongest asset protection laws in the US. On average, 1,000 people move to Florida daily. Undoubtedly the recent tax reform will be a huge catalyst as it clearly disfavors high tax northeast states, which are already the main source of the region's immigration. The slow trickle of migration from the Northeast is a massive tailwind for South Florida. 17 Fortune 500 companies are based in Florida and over 40% of all US trade with Latin and South America pass through the state. Miami is a great place for wealth managers and family offices, and over the last years more asset managers set up shop in Miami. In fact, the Miami Downtown Development Authority has seen over 50 finance firms moving to Miami. 9,000 high and ultra high net-worth individuals in South Florida When we look at the asset raising environment and compare Miami and Manhattan, these are certainly two distinct markets. Obviously Miami is the gateway to Latin America where also a lot more potential can be developed. But just South Florida has about 9,000 high net-worth and ultra high net-worth individuals, which for an asset management firm or for a fund that's just starting offers some real and significant opportunities. Subsequently when the asset base has grown to a certain level, the manager can then start to commute to Manhattan and looking for institutional opportunities. Both cities have advantages fund managers can capitalize on. Fund managers who recently moved into AI to cause trouble While in 2015, 47% of all hedge fund launches included a component of quantitative finance or machine learning and artificial intelligence, for 2018 Deloitte predicts this number to reach 70%. Of course, machine learning is only as good as the data that you have, but there may also be a dark side to AI. David Coggins is convinced fund managers and investment firms that have recently moved into this space will find the transition to be a difficult one. New challenges will arise such as having to refine quant models to reflect higher interest rates, inflation projects, etc. These types of situations are going to happen this year and will put global markets at risk, creating many market sell-offs in 2018, according to Coggins. Note that this Roundtable meeting took place in December 2017 in Miami, and that the participants pretty much nailed the VIX flash crash that happened in early February 2018.
The following experts participated at the Opalesque 2018 Miami Roundtable, sponsored by the Miami Downtown Development Authority:
The Opalesque Roundtable Series offers unparalleled intelligence on the most important global hedge fund jurisdictions and their players. The Roundtable Series is a free publication from Opalesque and is continually updated. Please scroll down to view the full selection of our Roundtables - covering the globe!
Other Opalesque Roundtables in Florida
Opalesque Roundtable Series - A Catalogue of Intelligence on Global Hedge Fund Centers:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||