AI-Powered Roboadvisor Trade Ideas Says Benzinga Fintech Summit 'Exceeded Expectations'

Trade Ideas, the fintech startup that uses artificial intelligence to pick stocks, has been named a finalist for the 2018 Benzinga Fintech Awards.

The company was one of three chosen by an audience vote at the Benzinga Fintech Summit Sept. 28 in San Francisco.

The Fintech Summit “exceeded expectations,” said David Aferiat, cofounder and managing partner at Trade Ideas, who gave a demo at the event.

“We have a great brand and we live up to that brand everyday delivering the advanced market analytics and actionable intelligence we generate from the machine learning AI that we publish,” he said.

Trade Ideas previously won best-in-class in the stock or options screeners category at the 2015 Benzinga Fintech Awards.

The Road To AI

As a startup, Trade Ideas was faced with the “constant allure” of venture capital dollars, Aferiat said.

“If we had taken VC money any earlier, we would have shot off in a direction that I don’t think would have landed us where we are today."

Trade Ideas’ core competency is managing big data in real time on an open platform, he said: “All of that was slowly built on and improved on a certain timeline that I don’t think could have been accelerated.”

Trade Ideas eventually arrived at a strategy after the company’s growth plateaued, Aferiat said: Generating maximum value on the first impression.

Trade Ideas arrived at AI as a solution when the company realized it had “an issue of scale,” Aferiat said: It couldn’t produce trading ideas manually for customers.

“The issue of scale gave birth to the AI, and the machine learning AI is now what handles the changing of these algorithms."

Founded in 2003 as a market analytics firm, Trade Ideas turned to artificial intelligence with the launch of its Roboadvisor — “HOLLY” — in 2016.

The name comes courtesy of a customer who beta-tested the platform, Aferiat said. The woman said that if the platform worked as described, it would “be like the Holy Grail.”

“We’re not going to call it the Holy Grail, but we can hint at that [and] call her ‘HOLLY,’” Aferiat said, recalling his response.

‘We Are AI-As-A-Service'

Trade Ideas has about 8,000 subscribers who are renewing on a monthly or yearly basis, Aferiat said.

“That’s really what makes us unique. We are AI-as-a-service.”

Aferiat counts BlackRock, Inc. BLK, Renaissance Financial and Point72 Asset Management among his competitors — but “these are quant funds with a staff of PhDs and an enormous amount of capital to put to work, but who do they serve?”

Trade Ideas has products geared toward self-directed investors, advisers, institutions and small-cap hedge funds.

The larger competitors “serve their fund investors,” Aferiat said. “We’re one of the few, if not the only [firm] that doesn’t serve just fund investors, but as an AI-as-a-service will provide this data to anyone who subscribes to this information.”

What’s Next For HOLLY?

In the short-term, Trade Ideas is constantly evaluating new data sets and asset classes, Aferiat said. The firm is also studying whether to add futures data and cryptocurrencies to its platform.

It’s all part of a broader vision to democratize access to advanced analytics, Aferiat said.

“We like the role of disruptor.”

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Dave Aferiat, cofounder and managing partner at Trade Ideas, at the Benzinga Fintech Summit Sept. 28. Photo by Ricky Mackie & Katie Cleese.