China

HSBC launches the First AI Powered Equity Index Structured Deposit Product in China

HSBC Bank (China) Limited (HSBC China) has announced that it has today launched the AI Powered US Equity 5 Index (AiPEX5), becoming the first bank in China offering an Index Linked Structured Deposit product utilising artificial intelligence (AI) as a method for equity investing.

It turns big data into investment insight by using AI to evaluate stocks with the aim of identifying international investment opportunities for individual investors in China to grow their wealth, HSBC China said in a press release.

AiPEX5, a part of the AiPEX family of indices, is the first and only rules-based equity strategies to use the artificial intelligence technology of IBM Watson.

The key advantages of AI powered equity strategies versus traditional investment strategies include:

  • Information advantage: The Index leverages AI capabilities to process and learn from vast amounts of publicly available, continuously generated data points and turns the data into investment insight. Data points could include a company announcement, news and a tweet.
  • Objective and well-established stock selection principles: It uses a rules-based process to objectively evaluate publicly traded companies and rebalances its equity portfolio monthly, and to manage short-term volatility, reallocates between the equity portfolio and cash component on a daily basis.

Richard Li, Executive Vice President and Head of Wealth and Personal Banking, China, HSBC, said: “Adoption of digital wealth and investment tools in China is accelerating at a faster pace than other markets globally. AI combined with big data equips investors with an innovative and more precise tool to navigate through increasingly volatile international markets. The take up of these new solutions is increasing among retail investors, especially millennials, seeking portfolio diversification. We are pleased to become the first bank in China to offering our clients a new way to tap into international markets.”

Chida Khatua, CEO, Equbot Asset Management, said: “We are pleased to become the exclusive partner of HSBC to offer AI investment strategy in China. The AI powered equity 5 index is like a fund manager who is 24/7 learning, able to tap investment opportunities derived from massive amount of data. We strongly believe that artificial intelligence can help investors adapt to the fast-changing world of information and become a key addition to future investment approach along side conventional method of equity selection strategies.”

HSBC is committed to bringing market-leading solutions to help clients capture new opportunities to grow wealth for themselves and businesses globally, says the firm. The Bank launched AiPEX5 in Singapore and Malaysia early in 2020 to accredited retail investors. The extension of AiPEX5 to China marks a further step in delivering the Bank’s strategy to become the leading wealth manager in Asia.