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- Leveraging AI on Cloud Platform to Analyse Retail Investors’ Behaviour
- and Trading Pattern Changes Pre- and Post-Covid Period
Bursa Malaysia Berhad (“Bursa Malaysia” or the “Exchange”) today announced the successful completion of its Retail Customer Experience (“CX”) Analytics Proof-of-Concept ("PoC"), a data-driven analytics project piloted on the Exchange’s Cloud and Artificial Intelligence (“AI”) platform. This PoC was undertaken in collaboration with four (4) Participating Organisations (“POs”), namely Hong Leong Investment Bank, CGS-CIMB Securities, Malacca Securities and RHB Investment Bank.
In 2020 during the height of the Covid-19 pandemic, significant increase in local retail trade participation was recorded in our capital market. Given the integral function of retail trades in maintaining market vibrancy and liquidity, it was imperative to better understand the retailers’ trading behaviour. However, this was a challenge given the scarcity of information of this investor group. Retail programmes and strategies are typically based on general demographics such as age, race or gender ― an approach that has some inherent bias, as not all retail investors fit in these demographics.
To address this issue, the CX PoC was designed as a collaborative effort between Bursa Malaysia and participating POs with the aim of advancing the development of the capital market’s investor base. Leveraging its in-depth industry-wide datasets, the Exchange developed a machine learning model built on its AI and Cloud platform, while also tapping into participating POs’ deeper understanding of their retail customer segments and distinct behaviours.
“In an effort to better understand the increasingly complex and changing investor behaviour, the Exchange will invest in accelerating its digital transformation journey in new technology and data analytics for successful customer outcomes,” said Datuk Muhamad Umar Swift, Chief Executive Officer of Bursa Malaysia.
A hyper-personalisation approach was applied to aid in the design of customised initiatives to cater to distinct retailers' needs, with the aim of bridging information gaps and improving retailers’ financial literacy. Additionally, this Cloud-enabled model facilitates multi-party collaboration in an efficient and cost effective manner, while driving a ‘single-source-of-truth’ perspective in the metrics used to identify trends and insights.
“We are pleased to have collaborated with participating POs on pioneering this PoC in exploring Cloud and AI capabilities for the betterment of our industry. The results will enable both participating POs and Bursa Malaysia, to further learn, develop and progress in retaining retail participation through data analytics,” added Datuk Umar Swift. “The CX PoC empowered our partners to bridge information gaps for retail investors”.
Kwek Kon Chao, Chief Operating Officer of Hong Leong Investment Bank (“HLIB”) shared that this collaboration allowed HLIB to uncover actionable insights and new opportunities using data and analytics, allowing them to further improve their customer care through personalised offerings. “This is a step forward towards improving our retail investors' customer journey with us, as we continuously monitor the results of our implemented strategies,” he said.
“The PoC has given us valuable insight into investor segments, and this has allowed us to offer customized financial programmes that support them in improving their level of financial literacy. We are encouraged by the traction gained by this analytics project and applaud Bursa Malaysia in driving the digital agenda, in particular the use of data, that will further benefit the capital market as a whole,” added Eddy Tan, RHB Investment Bank Head of Retail Equities & Futures.
Fok Chuan Meng, Malacca Securities Head of Dealing commented “The Retail CX POC helps us greatly in understanding our clients better in their trading preference, while providing valuable analysis in designing our trading support strategies.”
“The aid of machine learning in this POC paves the way for distinct investor segmentation and the development of targeted marketing strategies aimed at satisfying and aligning with our investors’ needs. We are excited to embed these robust data models and analytics across our business, from research to investor engagement and education,” said Alan Inn, Deputy CEO of CGS-CIMB Securities.
Meanwhile, Wong Chiun Chiek, Head of Bursa Data Business in Bursa Malaysia emphasised that in addition to this PoC, Bursa Malaysia has established a Minimum Viable Product (“MVP”) that includes a decision-making framework. “This is in line with Bursa Malaysia's strategic intent to offer new and innovative services to the industry using data and digital technologies,” he said.
With the completion of the PoC, the Exchange is moving closer to turning the MVP into a market-ready product. Bursa Malaysia will work closely with participating POs in order to continuously improve and refine the solution.
“This collaboration served as a platform for Bursa Malaysia and participating POs to explore and co-create more solutions on areas that are impactful to the industry, capitalising on data-driven and digital capabilities,” concluded Datuk Umar Swift. “The Exchange is committed to investing in advanced technology that will improve the data solutions and CX experience we provide to our stakeholders.”
