Featured in The Sydney Morning Herald and The Age, Saturday 10 April, 2021.
Traditional stock picking strategies rely on the assumption that investors make decisions in a completely rational and objective manner, while taking time to synthesise all available information. However, this assumption is a fairytale - markets are not perfect and neither are humans.
CEO and Founder, Tui Eruera created Jaaims after realising that he needed support with his investing decisions, and discovered the need for a fully automated trading app, a first to market in Australia of its kind.
Now returning 24.50%* on the Professional plan’s Smart Portfolio, Jaaims has evolved the traditional investing strategy to include the variance of human emotion through predicting future emotional trends using the power of artificial intelligence (AI).
The Dunning-Kruger effect in social psychology describes a tendency for people with low abilities at a task to overestimate their skill in performing it.
This hypothetical effect becomes quickly apparent to a novice trader in an environment where such overconfidence can soon empty their trading account.
“Without professional help, data shows that a novice will typically blow up their account in a few weeks, if not days,” says Tui Eruera.
“Essentially 76 per cent of first-time retail traders lose their money. And that’s the biggest problem at the moment - young people are getting into investing, and losing their money, which is obviously causing mental health issues and many other things.”
“With our platform, we remove that emotional side away for you, because we've built and designed a platform that decides when to buy and sell and then automate execution of those decisions.”
Knowledge is power
Each day, Jaaims analyses more than 10 million pieces of data from 250 different sources across the internet, including news and social media as well as fundamental market information, and uses an AI algorithm to process that data to come up with buy and sell recommendations on 1,000 equities across the US, Australia, the UK and German markets.
On average, it takes just 73 seconds per equity to digest data and derive a buy or sell recommendation. Stock recommendations are updated every 15 minutes within the application.
Once connected to a chosen broker, Jaaims autonomously opens and closes trades, even while investors sleep - which can effectively remove the emotional link from the equation – the human.
“I realised I knew very little about it – and since there were no automated trading apps available, I decided to create one and, in the process, democratise access to AI trading algorithms,” says Tui Eruera.
“The 2020 Investment Trends Online Investor research reveals that 400,000 people started investing online for the first time.”
“Even for the experienced investor, the challenge is how to identify good trading opportunities and the optimum time to act upon this opportunity. This has increased the pressure on industry participants to deliver tools and education for this increased number.”
Jaaims is one such tool which ranges from a signal service to a professional platform that can help manage and trade a portfolio worth up to $25 million for slightly heavier hitters.
“With the Professional package, we pick stocks for you, as well as execute,” Eruera says. “So that is the fully automated version. And that’s the easiest way for investors to get exposure to our algorithm.”
For the less experienced investor, Jaaims has three subscription plans and the Model Portfolio of 20 stocks which is fully automated and the portfolio can be edited directly by the investor.
The Bondi father-of-two says mastering emotional control is just as vitally important for full-time professional traders as it is for first-timers: “They say that investing is 20 per cent strategy, 80 per cent execution. And it can take years to master your emotions when investing. It’s a continual battle even for top equity strategists.”
Jaaims – which also goes live in the UK in July and enters Europe in September- fills a gap in the market for investors wanting access to quant fund or those whom are time poor looking for an automated trading system.
“Hedge funds and wealth managers can manage your money, but they require $100,000 to $150,000 minimum before they will look at you.”
“So, there is definitely a gap in the market - people who have $40,000 in savings that want to get a better return. Just by downloading an app, Jaaims gives traders access to the same AI and algorithms that the big end of town has and levels the playing field for the little guy.”
Adapted article originally appeared in the AFR on 9 March 2021 “Australian AI driving fully automated trading“;
Disclaimer: All returns are net of fees and in AUD. Calculations are based on our Professional subscription using our Smart Portfolio trading all markets with an average position size of $10,000 per trade and a broker fee of $9 per trade ($18 completed trade) which delivered a realised return of 24.50% from inception to 28 February 2021. Distributions are reinvested, after ongoing fees and expenses but excluding taxation. Actual performance will vary depending on position size and markets selected by the user. Past performance is not a reliable indicator of future performance. Inception date is 1 July 2020.