BlackRock lauds AI as ‘mega force’ to drive returns

cointelegraph.com:

Global investment titan BlackRock, which manages some $10 trillion in assets, has declared artificial intelligence a “mega force” that could create significant returns for investors in today’s “unusual” market.

In its mid-year outlook report, the BlackRock Investment Institute detailed their thesis for increased investment in AI — pointing to multiple “disruptive” themes that could see the sector grow rapidly over the coming years.

The report drew special attention to the fact that gains in the S&P 500 — the index that tracks the 500 largest companies in the United States — have become increasingly concentrated in a handful of tech stocks. The firm says investment in AI is a good way to capitalize on this concentration.

To BlackRock’s investment team, the most obvious “benefit” of AI lies in automation. While they admitted white-collar jobs are at an “increased risk” of being automated away, it said the resulting cost savings could significantly boost profit margins, especially for companies with high staff costs and an abundance of easily-automated tasks.

The team added that the nascent tech could prove to be a boon for companies that are currently sitting on a “gold mine” of proprietary data — with AI-powered tools allowing firms to leverage dormant information into “innovative” new models.

The report also listed the global push towards low-carbon economies, aging populations, and a rapidly-evolving financial system as key drivers of growth in the coming decade.

BlackRock isn’t alone in giving more airtime to AI. In a June 28 tweet, Matt Huang, the CEO of crypto investment firm Paradigm, said the rapid and varying developments in field of AI are simply “too interesting to ignore."

Paradigm has never been more dedicated to