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The Revolution and Application of AI in Investment, Finance, and Its Trustworthiness

In: Business and Management in Asia: Finance and Investments in the Digital Age

Author

Listed:
  • Archana Parashar

    (Indian Institute of Management (IIM))

  • Rounak Pal

    (Visvesvaraya National Institute of Technology)

Abstract

In this chapter, we take a close look at the transformational journey and effects of artificial intelligence (AI) on finance. It starts with history leading up to which its roots draw on science fiction for its early conceptualization until we get details about significant milestones such as Alan Turing's profound contribution and the period from 1956 to 1974. It focuses on improvements made in machine and deep learning using Frank Rosenblatt and John Mccarthy as examples among many trailblazers and depicts how AI has taken part in financial decisions employing Multi-Criteria Decision Analysis (MCDA) and Bayesian Structural Time Series (BSTS) models. We will further analyze how banks use AI to enhance efficiency, by examining improvements in their cyber security features. Generative algorithms can also be applied to understanding economic trends or even making investment decisions. Lastly, the chapter places a particular emphasis on the trustworthiness of AI. SAFE (Sustainability, Accuracy, Fairness, and Explainability) methodology has been introduced to ensure the dependability of AI applications needed in the various sectors.

Suggested Citation

  • Archana Parashar & Rounak Pal, 2025. "The Revolution and Application of AI in Investment, Finance, and Its Trustworthiness," Springer Books, in: Tobias Endress & Yuosre F. Badir (ed.), Business and Management in Asia: Finance and Investments in the Digital Age, pages 1-15, Springer.
    • Handle: RePEc:spr:sprchp:978-981-96-3452-1_1
    DOI: 10.1007/978-981-96-3452-1_1
    as

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