In an effort to combat stock market scammers, abusers, and manipulators, Hong Kong is unleashing an A.I to detect and expose them all.
Hong Kong Exchanges and Clearing is the first exchange to utilize the A.I program designed by Nasdaq, a technology and exchange group based in the US. Their program is to help analyze and determine unusual or illegal stock market use.
Tony Sio, in charge of exchange and regulator surveillance at Nasdaq, said: “New technology, such as high-frequency trading and cryptocurrencies, make trading increasingly more complex,”
“Rather than winding back the clock, exchanges must themselves make use of advanced technologies to ensure that markets are safe.”
The A.I program works by analyzing trading data to pinpoint anomalies as well as such as unexplainable surges or shifts in stock shares and prices.
Stock exchanges across the world are already introducing A.I software to their markets to handle misuse and exploitation. After a chain of companies plummeted in price, many suspicions were raised as to how everything was working and if mass manipulation was underway.
HKEX spoke about their introduction of the A.I, saying in a statement that their software was part of a “regular system upgrade, which does not reflect any increased threat of market manipulation or related to a change in the level of regulation”
Several companies were uncovered by government expert, David Webb, in what was a chain of “enigma companies” connected to one another by shared holdings. The uncovering of such companies is not the first of its kind, with the incident being just one among many other stock suspicions.
By opening a door to many more companies looking to be involved in stocks, companies with a higher risk may be added to the list for future revenue generation.