A postdoctoral fellow at Hong Kong Polytechnic University, Dr Kehinde Olubanjo, has advocated for the application of industrial engineering tools and skills to harness the potential of the financial markets.
Olubanjo made this call on Friday during the 35th online lecture series of the Industrial and Production Engineering Alumni Association, University of Ibadan, where he was the guest speaker.
His presentation, titled ‘From Efficiency to Equity: How Industrial Engineers Can Win Big in the Financial Markets’, focused on how industrial engineers can apply skills that they already have to play in the stock market successfully.
Providing a background of how he got into the market, Olubanjo said that he was challenged by his project supervisor, who wanted to retire but was seeking ways to grow his retirement benefits.
He said, “My supervisor called me and said, ‘I’m almost close to 70. I want to retire. Can you please think of something I can do that can fetch me money so that when I retire now, I don’t have to work or think about how to spend my pension or anything?’ That was how the idea was born. Throughout my first year, I started research not even for the academics.
He added, “I did a lot of personal research about how I can make money from others. It was very challenging, but I made a fortune from it before I stopped due to some visa issues. Over here, there is a particular amount you must have, and when you start to make more, it raises suspicion. Your bank can call you today or tomorrow. So that’s why I stopped, not because the system was not fetching me money again.”
Highlighting how he did it, Olubanjo’s call was underpinned by his experience and observations from Hong Kong, which he notes is the fourth-largest financial centre in the world, where finance dominates manufacturing, and many billionaires operate within the fintech sector.
Olubanjo notes that industrial engineers can “win big” in financial markets by leveraging their core skills and tools and proposes a paradigm shift where financial markets are treated “as a system of production.”
He articulated several key takeaways, saying, “Think of stock as a system where you have to put something in to get something out.”
The academic specifically highlighted how industrial engineering principles can be applied to address key issues in stock portfolio management, such as stock selection, optimisation and forecasting using advanced AI models to predict future price movements, enabling informed trading strategies.
The benefits include wealth building, improved screening and decision-making, which involves selecting optimal stocks and making informed investment decisions to maximise returns and minimise exposure to volatile assets, risk assessment and financial planning.
Dr Olubanjo also emphasised the critical role of advanced AI models in forecasting, saying, “Embrace how machine learning can help you to predict into the future. The current state of revolution in AI is about attention-based models, which is what I’m also working on even till now, so the whole world, if you are doing any research that is not attention-based, then you are not doing state-of-the-art research.”
He stressed the crucial role of AI, particularly attention-based transformer models, for predicting future market movements, adding that these are the “current state of revolution in AI” and are the “state-of-the-art of all models” for financial forecasting. His research demonstrated that transformer models provided superior results in predicting market indices like the S&P 500, FTSE 100, and HSI compared to other machine learning models.
A core message of his presentation was the wealth-building potential of industrial engineering tools.
He stated, “Your tools can build wealth; your tools, like data analytics, can help you build wealth.”
He issued a direct call to action for industrial engineers to engage with the financial markets, stating, “Don’t sit on the lines.” He encouraged the audience to recognise that “you can actually make a lot of money by thinking of how you can apply IE skills or IE to finance.”
Speaking also at the online lecture, the Director of the Pan African University of Life and Earth Sciences Institute (including Health and Agriculture), Professor Mubo Sonibare, who was the special guest of honour, said, “This lecture is very good because finance is what you need every day, whether you are an engineer or not. I’m not one. I know some of the highlights of the principles of engineering, such as optimisation, efficient measurement, and data-driven decisions, can become applicable to our everyday lives.”
Sonibare hoped that participants at the lecture would be able to think beyond the shop floor to get to the trading floor so that the lessons we learn at this lecture will find expression in our lives as we apply the principles.
