Artificial intelligence (AI) is already boosting the investment operations of asset managers, according to research by Mercer.
The report titled How Artificial Intelligence is shaping asset management was based on responses from 131 asset managers around the world.
Mercer said the industry has moved beyond experimenting with AI, but the technology remains ‘principally an augmentation tool’ that helps to enhance human productivity and insight.
The researchers found evidence of growing AI adoption and enthusiasm in asset management firms, but also identified practical barriers that continue to limit its use in investment decision-making.
A majority of respondents (55%) said their firms have integrated AI into at least one of their investment processes despite these barriers, while 27% reported integrating AI as a pilot or proof-of-concept.
At the other end of the scale, close to one in five (18%) of surveyed managers have not yet integrated AI into their investment processes at all, yet almost all (91%) said they plan to increase their use of AI in the next 12 months.
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Firms most commonly use AI to improve productivity, with 73% saying they use it for operational efficiency in their existing teams.
Two in three of those questioned (68%) use AI as a ‘partner’ in the investment process to provide insights and analysis.
Use of agentic, or autonomous AI has begun, but only at a small number of firms, with just 5% of respondents saying they have granted AI autonomous or semi-autonomous decision-making authority for investment recommendations or trades.
While large efficiencies are being found in operations, only 8% of firms reported ‘measurable improvements’ in investment returns from implementing AI.
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Data constraints and regulatory concerns were described by Mercer as the ‘principal frictions’ to broader AI adoption by asset managers, with 69% of firms citing data quality or access, and 59% citing regulatory or compliance concerns.
Beverley Sharp, global manager research leader at Mercer, said: “AI is delivering measurable efficiency and insight for asset managers today, but the technology is largely a partner rather than a decision‑maker.
“Addressing data, regulatory, and integration challenges will be essential to realise AI’s broader potential in portfolio construction and execution.
“Our survey finds AI is mainly being used upstream for idea generation and research in the asset management industry.
“This mirrors our experience with AI,” she added. “Across Mercer, we’re innovating, using the technology to help our clients, including developing an AI‑powered manager research tool to help streamline the collation of data and the drafting of due diligence documents, with more tools to come.”
