High-Flyer Sparks AI Revolution in China’s Fund Industry

Chinese hedge fund High-Flyer has ignited an AI-driven transformation within the nation’s $10 trillion fund management industry. By integrating artificial intelligence into its multi-billion-dollar portfolio and founding DeepSeek—a groundbreaking AI start-up—High-Flyer has spurred an AI arms race among mainland asset managers.

DeepSeek’s cost-efficient large language model has drawn global attention, challenging Silicon Valley’s dominance in the AI sector.

This revolution has inspired other hedge funds, including Baiont Quant, Wizard Quant, and Mingshi Investment Management, to intensify AI research. Mutual fund companies are also adopting DeepSeek’s technology to enhance their investment workflows.

Baiont Quant’s CEO, Feng Ji, described the industry as being in the “eye of the storm” of an AI revolution, noting how skeptics of AI-powered trading are now racing to catch up.

Read Also: DeepSeek Prioritises Research Over Revenue, Achieves Key Milestone

While most funds use AI to analyse data and create trading signals tailored to investor risk profiles, competition to outperform the market is heating up.

Firms like Wizard Quant and Mingshi are recruiting top AI talent to spearhead innovation, while UBI Quant has highlighted its long-standing AI lab during recent investor roadshows.

Local authorities are also stepping in to support this technological shift. Shenzhen’s government has pledged 4.5 billion yuan ($620.75 million) to subsidize hedge funds’ computing power needs, boosting AI development across the region.

In the mutual fund sector, firms such as China Merchants Fund, E Fund, and Dacheng Fund have embraced DeepSeek, which has significantly lowered the barriers to AI adoption.

Zheshang Fund Management is leveraging AI agents to handle tasks like market monitoring and reporting, enabling human analysts to focus on creative work.

Industry experts, including Larry Cao of FinAI Research, believe that DeepSeek has leveled the playing field for Chinese fund managers, allowing smaller players to compete with their larger international counterparts.

With AI advancing rapidly, late entrants in the sector are finding opportunities to challenge established leaders, signaling a new era in investment management.

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