A former hedge-fund trader's AI platform predicts bitcoin returns will crush ethereum by 33% over the next 3 months. He explains how users of the service are beating the average stock-market investor by 18%.
Artificial intelligence has many applications, from the sublime to the ridiculous. Helping people make smart and profitable investments is a use case at the highly valuable end of the scale.
Giuseppe Sette, the cofounder and president of the online investing platform Toggle AI, said some of its users were beating average stock-market returns by up to 18% by using the technology, and now it is being applied to crypto investing.
Sette, whose background is in quant trading at hedge funds, said the platform provided an "augmented investing experience" that guides users through the markets.
Toggle AI has grown rapidly — it says it has 70 institutional clients with a total of $165 billion in assets using the research tool, as well as 70,000 retail investors, who pay $10 a month. It's been endorsed by the legendary investor Stanley Druckenmiller, whose firm gave Toggle's CEO, Jan Szilagyi, his start in 2005.
The system is based on machine learning, which involves feeding huge volumes of data into computer algorithms. The algorithms then identify trends, links, and correlations in the data to indicate the likeliest price movements of stocks and now cryptos.
"We try to focus on the data that is less known or less available to the broader investing public," Sette said. "So we make a huge effort to bring to the surface fundamental stocks data, macroeconomic data, and try to use the AI not as a black box but rather to provide a 'glass box' experience to the user."
Success depends on the quantity and quality of the data, and Sette said there is a vast amount of useful data that Toggle AI uses in its analysis.
"The machine learning tries to spot what's really important to know about a stock or crypto," Sette said. "We do that in terms of the data that comes out of stock analysts, macroeconomics, geopolitical tensions.
"On the news side, we have modules that read all the news and try to come back to you with a selection that tells you 'This one is most likely to move the market, and we think you should read this.' It's not just a sentiment analysis, which is quite common — it's a proper market-moving analysis in the sense of making sure that you're aware of specific things that might be relevant for your securities."