Leading brokerage firm OCBC Securities was established in Singapore in 1986 and offers reliable, secure, end-to-end encryption trading. An early adopter of electronic platforms, OCBC Securities is an award-winner many times over, its accolades including Global Banking & Finance awards for Best Mobile Trading Platform – Singapore and Most Innovative Trading Platform – Singapore for three successive years.

This year, OCBC Securities launched A.I. Oscar, Singapore’s first AI-powered stock-picker tool, and Managing Director Wilson He talked to Wanda Rich, editor of Global Banking & Finance Review about its development, the benefits it provides, and how its personalised recommendations compare with traditional human analysis.

Can you give us an overview of A.I. Oscar and its main purpose on the iOCBC platform?

A.I. Oscar, which stands for OCBC Securities Customer Artificial-Intelligence Radar, was developed in-house by OCBC’s AI Lab and OCBC Securities. The creation of A.I. Oscar aligns with our corporate strategy to focus on accelerating transformation and digitalisation as a key pillar. It is an AI-powered virtual trading assistant that is redefining the role of technology in the stockbroking industry. Unlike other AI-enabled applications, A.I. Oscar goes a step further by providing personalised stock ideas tailored to each individual user based on their trading history on our platform. Built to function much like a personal trading assistant, A.I. Oscar monitors the market round the clock and offers users timely insights. Whether you are a seasoned trader or a beginner, A.I. Oscar continuously learns from your past trading behaviour to refine and deliver insights that are more relevant to you. As such, A.I. Oscar aims to empower users to make more informed trading decisions and enhance their overall trading experience on the iOCBC platform.

How does A.I. Oscar differ from other AI-enabled applications offered by competitors in the stockbroking industry?

A.I. Oscar sets itself apart from other AI-enabled applications through its highly sophisticated deep learning network. Unlike typical rule-based models that make decisions based on a few pre-set criteria, this machine-learning technology mimics the decision-making process of the human brain. This enables the model to go beyond simple rules and dynamically learn from the vast amounts of trusted market data from reputable partners like Nasdaq and LSEG Data & Analytics. Instead of being limited to predefined conditions, A.I. Oscar’s deep learning algorithms can identify and predict possible market patterns. To provide more relevant stock ideas, it also looks at a customer’s trading history with us to provide 15 personalised stock ideas for them every week. When we launched A.I. Oscar for the Singapore market in 2023, we saw that trading activity among young investors under 35 increased by 50% during the pilot period compared to the months before. Going forward, we aim to triple our active customer base in this segment.

Could you explain how A.I. Oscar’s deep learning network operates and how it contributes to stock price predictions?

A.I. Oscar is built on a transformer-based neural network model that incorporates additional deep learning components specifically suited to forecasting. Unlike simpler models, A.I. Oscar takes a multi-perspective approach. It looks at the data through both short-term and long-term lenses simultaneously to uncover complex patterns for each stock. It also selectively combines information across stocks, capturing interdependencies between different stocks, and determines the most relevant information to refine its prediction. A.I. Oscar also consumes a huge volume of premium data that OCBC Securities obtains from LSEG Data & Analytics each day. Apart from indexes and fundamental and technical indicators, A.I. Oscar also makes use of up to intra-day granularity of global transactions for each stock. These data flow through the deep learning network model that has millions of parameters, like volume knobs, that are tuned in combination to silence or amplify certain signs to detect possible trends and potential stock price movements.

What are the main benefits that customers can expect to see from using A.I. Oscar?

A.I. Oscar serves as a highly efficient and intelligent trading assistant. Compared to human analysts who can realistically analyse only a handful of stocks each day due to time and cognitive constraints, A.I. Oscar is capable of scanning through massive amounts of data from thousands of stocks across major markets simultaneously. It is able to evaluate stocks in parallel, quickly generating insights and reports that would otherwise require an entire team of analysts working around the clock.

A.I. Oscar was trained with data from over 4,000 stocks across major exchanges like SGX, HKEX, NASDAQ and NYSE, which include more than a decade’s worth of stock fundamentals, macroeconomic factors, market patterns and technical indicators. This allows it to generate stock ideas that align with diverse trading strategies and market conditions. I believe that speed is crucial in trading, as traders need to respond to market events and make informed decisions swiftly. With A.I. Oscar, investors can easily recognise potential opportunities in the market that are relevant and act on them without delay.

In addition, while human intuition and judgement remain invaluable, emotions can sometimes cloud decisions, especially in today’s volatile and uncertain markets. This is where A.I. Oscar can complement human decision-making in stock trading. As A.I. Oscar has no emotions and hence is not swayed by emotional biases or market noises, this allows traders to combine their personal insights with the AI’s objective analysis for a more balanced and informed approach to trading.

How does A.I. Oscar personalise trading recommendations for individual users?

In today’s information-heavy world, investors are often inundated with an overwhelming volume of information, much of which is either irrelevant or too time-consuming to analyse manually. A.I. Oscar addresses this issue by using advanced machine learning algorithms to sift through all these data and curate trading ideas that are most relevant to each individual investor, based on their past trading activities. For instance, if a customer frequently trades SIA (Singapore Airlines) stock, A.I. Oscar will prioritise sending insights related to SIA to the customer whenever it detects significant market signals from that stock.

The power of A.I. Oscar lies in its ability to generate a wide range of personalised stock ideas. From a pool of diverse stock ideas, A.I. Oscar can intelligently select the five most relevant ones for each investor based on their past trading history. This dynamic and tailored selection process means that each user could potentially receive a different report, providing a highly customised trading experience. Such precision is achieved through a sophisticated CRM (customer relationship management) engine that operates behind the scenes, significantly enhancing both productivity and customer engagement. The result is a trading assistant that is not just smart but also highly attuned to each investor.

How has A.I. Oscar performed in stock market predictions compared to human analysts so far?

Earlier this year, we ran an in-house challenge to explore the difference in the performance of A.I. Oscar and human traders in predicting stock movements. The participants, who included staff from various front- and back-office functions, used diverse strategies like fundamental analysis, technical analysis and intuition. Both A.I. Oscar and the human traders had their winning moments – there were weeks when A.I. Oscar outperformed and weeks when human traders came out ahead. Interestingly, we found that A.I. Oscar particularly excelled in bearish markets, maintaining objectivity and analytical rigour in offering unbiased, data-driven insights free from emotional influences. In contrast, human traders are tuned to identify bullish opportunities, leveraging their instinctive market judgement and intuitive insights. The challenge highlighted the significance of integrating AI’s data-driven precision with the creativity and intuition of humans to achieve a more balanced and comprehensive strategy for stock trading by leveraging the best of both human and AI capabilities. In fact, in Season 2 of the challenge, we observed a shift in how human participants predict stock movements. They started learning from A.I. Oscar’s approach and displayed greater confidence in identifying and acting on bearish markets compared to Season 1. This demonstrates the potential for continued advancements in stock trading processes, as AI and humans continuously learn from one another and leverage each other’s strengths to deliver more informed predictions.

What measures are in place to ensure the continuous improvement of A.I. Oscar’s prediction accuracy?

Financial markets are inherently volatile and subject to various factors, so it’s essential that A.I. Oscar evolves with these constant shifts in market dynamics. We are employing a multi-faceted approach centred around ongoing refinement, data expansion and customer feedback. Our dedicated team of data scientists and trading strategists are always exploring the latest AI modelling techniques to improve A.I. Oscar’s ability to predict potential market movements and better comprehend the market. As investors make more trades on our platform, A.I. Oscar also constantly analyses such data to understand the individual’s trading history. This enables A.I. Oscar to refine its algorithms and provide more personalised watchlists for that investor moving forward. While we continue to fine-tune A.I. Oscar’s algorithms and expand its data sources, we continuously strive to make A.I. Oscar highly responsive to market fluctuations and deliver more timely insights to our customers.

How does A.I. Oscar engage with customers? What channels are used to deliver trading ideas and insights?

A.I. Oscar can be found on multiple channels, including the iOCBC Mobile Trading app, the iOCBC online trading platform, and email. Within the iOCBC Mobile Trading app, A.I. Oscar can be found under “AI Watchlist,” where it features 15 personalised stock ideas, which have now expanded to cover the Singapore, US and Hong Kong markets. This is weekly and customers can enable push notifications on the app to ensure they do not miss out on any new stock ideas.

What were some of the challenges faced in developing A.I. Oscar, and how did the collaboration between different departments help overcome them?

Developing an AI tool that can effectively support human investors in trading was a challenging endeavour that required a collective effort and collaboration across multiple departments within OCBC Securities. Each team brought unique expertise to the table to tackle the complexities involved in this project. One of the primary challenges was translating the skills and instincts of a human trading strategist into codes that an AI model could understand and replicate. The inputs and feedback from seasoned trading strategists were invaluable in fine-tuning A.I. Oscar, helping it become a robust tool capable of providing useful insights based on a wide array of data points. In addition to the technical hurdles, there was also the challenge of creating a user-friendly interface that could effectively convey A.I. Oscar’s complex insights in a way that was understandable and actionable for customers. The Customer Experience team played a pivotal role here, working closely with customers to create a user-friendly interface. It used feedback from customer labs to identify areas that users found confusing, to simplify the presentation of data. This feedback loop allowed for rapid iterations and continuous improvements, ensuring that the final product was not only effective in generating insightful stock ideas but also intuitive and easy to use. This collaborative effort between various departments was the key to turning A.I. Oscar from a concept into a fully functional reality. The blend of diverse skills and perspectives made the journey of developing A.I. Oscar a successful and transformative one for OCBC Securities.

What future enhancements or features can customers expect to see in A.I. Oscar?

As customers look for faster and more succinct news, A.I. Oscar is constantly evolving to keep pace with these expectations. In a rapidly changing market environment, investors are seeking tools that not only provide accurate information but also deliver it in a timely and accessible manner. To address this, we are focused on further enhancing A.I. Oscar’s capabilities to make it even more responsive and adaptive to user needs. As we continue to leverage AI and incorporate customer feedback, future versions of A.I. Oscar will focus on making it more interactive with customers, such as allowing users to ask questions and receive answers to further streamline their trading experience on our platforms.