Industry Updates

Algo-Chain leverages ChatGPT to power ETF portfolios

AI augmented portfolios help navigate the ‘vast amount of data embedded in the close to $10trn ETF ecosystem’

Jamie Gordon

Allan Lane, CEO and co-founder of Algo-Chain

Wealth management fintech Algo-Chain has launched its ETF Portfolio AI Toolkit subscription service, powered by the ChatGPT 3.5 Turbo model.

The toolkit offers users a range of ETF model portfolios which use technical signals and macro-economic data to identify tactical opportunities and select asset allocation models that have fared best in similar scenarios in the past.

The ChatGPT framework allows wealth managers to sift through thousands of ETF listings and choose target risk portfolios including ESG and crypto exposures.

Algo-Chain decided to develop the tool following the spike in interest in AI-augmented tools so far this year, with OpenAI’s suite of models seeing over 100 million users register within its first eight weeks.

Allan Lane (pictured), co-founder and CEO of Algo-Chain commented: “Many investment managers will oversee multiple sets of model portfolios, with and without an ESG theme, across multiple risk categories and in different currencies, resulting in a large number of permutations that need addressing at the portfolio construction stage.

“Given that a portfolio’s asset allocation accounts for the lion’s share of a portfolio’s return, it seemed only natural to design an algorithm that searches through an extensive range of portfolio allocations that can give the manager an edge.

“The portfolios can be augmented by an intelligent search process that can make sense of the vast amount of data embedded in the close to $10trn ETF ecosystem, assisting in the process of tactical asset allocation.”

Algo-Chain’s ChatGPT toolkit becomes only its latest model portfolio offering in recent months. In February, the firm partnered with HANetf to launch six model portfolios incorporating thematic, commodity and crypto exposures.

Last October, ETF Stream revealed it partnered with Leverage Shares to offer discretionary wealth managers the opportunity to wrap their model portfolios within exchange-traded products (ETPs) for more efficient distribution.

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