Goldman Sachs (NYSE:GS) to replace Analysts with New Software
Goldman Sachs (NYSE:GS) is planning to introduce a software that would be able to replace the traditional analysts. The company has already provided a $15 million investment to Kensho, which is a financial data service. The Kensho company will provide Goldman Sachs (NYSE:GS) with analysts who will be working round the clock. However, this might be bad news for our analysts but these are the changes which can’t be avoided.
Moreover reports offered by the Financial Times suggest that giant companies like Google and CNBC are also clients for Kensho. Lets’ see what Kensho is actually planning to aim for and are the companies going to buy this product or not. Kensho has stated that the company will provide its customers with next generation computer analysis. The company will combine a touch of statistical computation with user friendly features.
The purpose of processing this raw unstructured data is to provide the user with an analysis just like a professional analyst would do. Kensho’s data computing system will give investment professionals accurate results with extreme speed and on the different scales required. This breakthrough will be another step towards artificial intelligence. Kensho claims that the software has the ability to provide answers to complex analytical questions, when and if asked in simple plain English of course.
This will allow its users to calculate all their risks and profits any time they want. Moreover, the user can put in different conditions to look for all possible outcomes. But if it is true than this can spell danger for almost every financial analyst living on earth. The software will eliminate the requirement of a financial analyst or analysts and provide with accurate results at very low costs.
Luckily, at the moment the analysts are not too endangered because of the increasing amount of data. Currently the software does require interpretation of large amounts of data but no such change regarding replacement of analysts can be seen immediately. But if the machines once start interpreting the data they are handling, they would be sending the analysts to look for some other job in the market.
After all who wouldn’t prefer a faster, cheaper and better method for analysis? Moreover, the analysts are not alone in this problem. If the software becomes a success it would create a situation of joblessness for nearly all white collar jobs. Offices will be replaced with computing systems and algorithms. This will mean a complete take over by machines. In fact this trend can also be seen in several industries where labor has been replaced by robots and machines.
However, it will take some time to take over these desk jobs as previously stated. In fact platforms like the Narrative Science have already started this trend. They can use a company’s financial readings and write reports based on those points. If companies like Kensho and Narrative Science join hands they can change the fate of traditional financial analysis for sure.