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Japan’s GPIF mulls use of AI in pension asset management

JIJI

The Government Pension Investment Fund is considering using artificial intelligence technology to manage its assets, sources have said.

The GPIF, which manages public pension assets, believes the introduction of AI will enable much quicker and more elaborate market analysis than a human can provide, at a low cost, the sources said Thursday.

The organization aims to introduce the technology on a trial basis as early as fiscal 2018, which starts in April next year, the sources said.

Use of AI is spreading globally in the asset management industry.

In the United States, firms including BlackRock Inc. and Goldman Sachs are already using AI in asset management. Some U.S. firms provide robot advisory services that give advice matching the needs of clients who make decisions on issues such as asset allocation. The service has also started expanding to Japan.

If GPIF, the world’s largest pension fund with over ¥150 trillion under management, starts to use AI, that may influence other Japanese institutional investors. Currently, an external agency commissioned by the GPIF is looking into the impact of the technology on asset management.

Some specialists have pointed out that the way AI handles sudden changes in the market environment remains unknown, so GPIF plans to consider carefully any possible introduction of the technology, the sources said.