Reporting for Artificial Intelligence (AI) and Machine Learning (ML) applications and systems offered and used by market intermediaries

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....s (eg: "robo advisors") in investor and consumer facing products. SEBI is conducting a survey and creating an inventory of the AI / ML landscape in the Indian financial markets to gain an in-depth understanding of the adoption of such technologies in the markets and to ensure preparedness for any AI / ML policies that may arise in the future. 2. As most AI / ML systems are black boxes and their behavior cannot be easily quantified, it is imperative to ensure that any advertised financial benefit owing to these technologies in investor facing financial products offered by intermediaries should not constitute to misrepresentation Scope definition 3. Any set of applications / software / programs / executable / systems (computer ....

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....expiry of the quarter. 7. Stock Exchanges and Depositories have to consolidate and compile a report, on AI / ML applications and systems reported by registered Stock Brokers / Depository Participants in the reporting format (Annexure C) on quarterly basis. The said report (Annexure C) shall be submitted in soft copy only at [email protected] (for Stock Exchange) / [email protected] (for Depositories) to SEBI within 30 calendar days of the expiry of the quarter, starting from quarter ending March 2019. 8. Stock Exchanges and Depositories shall; a) make necessary amendments to the relevant byelaws, rules and regulations for the implementation of the above direction; b) bring the provisions of this circular to the notice of their ....

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....nate investment or trading advice or strategies? <Yes / NO> 7.d Is the application/system used in area of Cyber Security to detect attacks <Yes / NO> 7.e What claims have been made regarding AI and ML Application / System - if any? <free text field> 8 What is the name of the Tool / Technology that is categorized as AI and ML system / Application and submissions are declared vide this response <free text field> 9 How was the AI or ML project implemented <Internally / through solution provider / Jointly with a solution provider or third party> 10 Are the key controls and control points in your AI or ML application or systems in accordance to circular of SEBI that mandate cyber security control r....

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....real world input data and deciding future outputs based upon the knowledge base. Eg: System based on Decision tree, random forest,&nbsp; K mean, Markov decision process, Gradient boosting Algorithms. 4.&nbsp; A system that uses statistical heuristics method instead of procedural algorithms or the system / application applies clustering or categorization algorithms to categorize data without a predefined set of categories 5.&nbsp; A system that uses a feedback mechanism to improve its parameters and bases it subsequent execution steps on these parameters. 6.&nbsp; A system that does knowledge representation and maintains a knowledge base. Annexure C - Consolidated Quarterly Reporting Form &nbsp; Consolidated Quarterly repor....