Digitizing securities for a global marketplace: A digital hedgefund based on transparency, openness and machine learning

Yesterday hedgefunds were mystified, local and closed shops where the underlying data was hidden and only accessible for a few wealthy customers.

Today a hedgefund can be fully digitized, crowdfunded and based on open data accessible globally for everybody: Participants use the raw market data published by the hedgefund for developing their own trading algorithms (based on machine learning) and deploy them to the hedgefund’s digital marketplace. It’s all about open markets, competition and incentivation of the market participants: “We have turned the stock market into a data science problem.”

Sounds like science fiction? This is already happening today — have a look at http://numer.ai

But — why not think of an insurance marketplace in the same way? Publishing an anonymized data feed of risks as open dataset and enabling other market participants to manage and transfer these risks into an competitive, decentralized marketplace — like Numerai does for securities.

Science Fiction?