Artificial intelligence (AI)
Artificial Intelligence (AI) is a transformative technology, poised to revolutionize many facets of our daily lives. Capital markets are part of this wave of change. Market participants are rapidly designing, developing, and deploying AI systems in their businesses.
We recognize the important opportunities that AI systems can bring to capital markets - and are mindful of the risks associated with their use. We strive to support an environment where:
- the deployment of AI systems enhances the investor experience while the risk of investor harm is addressed,
- markets can benefit from potential efficiencies and increased competition brought on by the use of AI systems,
- regulatory clarity supports capital formation in this sector, and
- any new types of risks, including systemic risks, are appropriately mitigated.
It is important that we learn from one another to understand the potential for AI systems to impact capital markets and to put in place appropriate safeguards to maintain confidence in capital markets.
Here are our latest publications and research related to AI systems in capital markets.
CSA Staff Notice and Consultation 11-348 - Applicability of Canadian Securities Laws and the use of Artificial Intelligence Systems in Capital Markets
This staff notice provides clarity and guidance on how securities legislation applies to the use of AI systems by market participants. The consultation seeks stakeholder feedback through questions on the evolving role of AI systems and the opportunities to tailor or modify current approaches to oversight and regulation.
AI in capital markets – exploring use cases in Ontario
This report explores the use of AI systems in Ontario’s capital markets. The report highlights current AI use cases, benefits and challenges, and aims to raise awareness of both the opportunities and risks associated with the use of AI in capital markets.
Artificial Intelligence and Retail Investing: Scams and Effective Countermeasures
This study explores how AI technologies might heighten investors’ vulnerability to scams and evaluates strategies to protect retail investors. AI is being used to make scams more effective and harder to detect, with new scams like deepfakes and voice cloning emerging. We identified both system- and individual-level mitigations to address these risks. Our experiment showed that generative AI tools can increase the appeal of fraudulent investment opportunities and that certain techniques can mitigate the effectiveness of these scams. We conclude that both system-level and individual-level mitigations are important for protecting retail investors from AI scams.
Artificial Intelligence and Retail Investing: Use Cases and Experimental Research
This study investigates the applications of artificial intelligence (AI) in retail investing, including a behavioural science experiment to understand the impact of AI on investor behaviour. The research highlights three investor-facing use cases of AI: decision support, automation, and scams and fraud. The experiment explores how Canadians adhere to an investment suggestion provided by one of three sources: a human provider, an AI tool, or a human provider using an AI tool (i.e., ‘blended’ source). While adherence to suggestions from the ‘blended’ source was highest, there were no significant differences across sources, indicating that Canadians are receptive to advice from AI systems. These findings underscore the importance of using unbiased, high-quality data in AI systems offering investment advice.
