Kasikornbank (KBank) has partnered with BlackRock, the world's largest investment management company, to offer its high net worth customers a feeder fund that uses big data analytics and machine learning.
The fund is intended to help KBank grow its private banking business by 15% this year, said Triphon Phumwiwasana, head for private business.
The bank will channel at least 80% of the total assets of Kasikorn Equity Absolute Return (K-Art Fund), its foreign feeder open-ended fund, into BlackRock's master fund, BSF Americas Diversified Equity Absolute Return Fund, Class I2 USD.
The master fund will be managed by New York-headquartered BlackRock, which manages more than US$5.7 trillion (190 trillion baht) in assets -- more than any other investment firm.
KBank expects the K-Art fund to log an average return of 5% a year. Its target customer segment is high net worth individuals ready to put in a minimum investment of 550,000 baht into the mutual fund, which was given six points on the Securities and Exchange Commission's 10-point risk scale.
Damien Mooney, managing director and head of retail business of BlackRock (Asia-Pacific), said the master fund generates returns by applying big data and machine learning technology to manage the massive flow of complex, fast-changing market information.
Mr Mooney said the master fund is designed to generate positive returns in all market conditions through a "market neutral" investment strategy, which seeks to mitigate all risks.
"Big data and machine learning help analyse and forecast trends in the market. They can help us find selling signals like when search traffic for a particular company declines," he said.
The master fund portfolio is allocated between Canada, the US and Latin American countries with plenty of big public data to track and analyse.
Mr Triphon said the BlackRock deal will benefit high net worth customers and drive the bank to achieve its private banking business growth target of 15% per year.
In the first three quarters, the bank had about 10,000 private banking customers (34% market share), which represents 750 billion baht in assets under management.
The 5-billion-baht K-Art fund will be opened for subscriptions from Sept 26 to Oct 4.