British mathematician Alan Turing developed the Turing test, a milestone in the development of artificial intelligence (AI), in 1950. The test administrator asks the subject, who is hidden from view, a series of questions intended to reveal whether they are human or a computer. According to Turing, a computer that could pass his test, that is, pass as human, is intelligent.

Hedge funds using AI in their trading strategies are confronting a different test of computers’ potential to display intelligence: can a machine trading against a human make more money?