News Release
NAM and NRI Conduct Proof of Concept for Applying AI in theAsset Management Industry-PoC for investment decision makingTOKYO, June 26, 2017 – Nomura Asset Management Co., Ltd. (NAM), one of Japan’s leading
investment managers, and Nomura Research Institute, Ltd. (NRI), a leading provider ofconsulting services and system solutions, today announced that they have conducted a proof ofconcept (PoC) study to examine natural language processing utilizing Artificial Intelligence (AI).
The objective of the PoC was to assess whether analysis with AI would contribute to increased
accuracy of portfolio managers’ investment decision-making. Portfolio managers at asset
management firms usually have to process and analyze a large amount of information which
includes not only analyst reports, but also a flood of various news sources, industry blogs andsocial media, such as Twitter®, to make forecasts and determine the impact on stock prices.
NAM and NRI worked jointly using AI technology to analyze all the information a portfolio
manager would consume and score them into two groups; either positive (indicating thatcompany performance or corporate value is likely to rise) or negative (indicating these factors
are likely not to rise). This PoC is one of the first full-scale efforts made by a Japanese asset
manager to analyze and score analyst reports using AI.
To run this PoC, NRI’s experience in developing AI solutions and natural language analysis wasused. NRI first conducted a natural language analysis on analyst reports which highlighted theshifts of investment decisions (For example, a shift from neutral to overweight or from neutral tounderweight). The language patterns for “positive” and “negative” were then identified and usedas training data for AI. Finally, the AI calculated the similarities between the training data andthe targeted materials, scoring whether each piece of information is “positive” or “negative”.
The result of the PoC highlighted that analysis of analyst reports using AI enabled thequantitative assessment of information which portfolio managers usually see as qualitative. Inaddition, even text information from news websites and blogs could be quantitatively scored andused to enhance the ability of portfolio managers to make investment decisions. In the future, it
is expected that more information that could not have been captured by humans qualitatively,
will be available as quantitative information and utilized for investment decision-making.
The PoC was conducted in 2016 and 2017. NAM and NRI plan to continue to work with clientsto create PoCs and to explore cases where AI can help to move the industry forward.

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Overview of the PoC###About NAM
NAM was established in 1997 through the merger of Nomura Securities Investment TrustManagement Co., Ltd. (founded in 1959) and Nomura Investment Management Co., Ltd.
(founded in 1981). With total assets under management of approximately $426 billion as ofMarch 2017, NAM has grown to become one of Japan’s leading investment managers. NAM’sinternational business has grown continuously since establishment, offering investment strategies
to clients based across Asia, Europe and North and Latin America.
For more information, visit http://www.nomura-am.co.jp/english/
About NRI
Founded in 1965, NRI is a leading global provider of system solutions and consulting services
with annual sales exceeding $3.7 billion.
NRI offers clients holistic support of all aspects of operations from back- to front-office, withNRI’s research expertise and innovative solutions as well as understanding of operational
challenges faced by financial services firms. The clients include broker-dealers, asset managers,banks and insurance providers. NRI has 35 offices globally including in New York, London,
Tokyo, Hong Kong and Singapore, with over 10,000 employees.
For more information, visit http://fis.nri.co.jp/en
Media Inquiries
Joey Wu / Michael Lintaro YasuharaGroup Corporate Communications Dept.
Nomura Holdings, Inc.
Tel: +81-3-3278-0591

2Koichi Wakabayashi / Yukako Seto
Corporate Communications Department
Nomura Research Institute, Ltd.
Tel: +81 3-5877-7100 E-mail: kouhou@nri.co.jp

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