London-based hedge fund Sand Grove Capital Management has cut the time it takes to analyze merger documents from 15-20 minutes to seconds using AI tools. The firm, which trades around corporate events like M&A deals, employs Anthropic's Claude, Microsoft Copilot and ChatGPT to review lengthy deal documents that previously required over an hour of human review.

A survey by the Alternative Investment Management Association found 95 per cent of hedge funds managing roughly $788bn are now using AI, with 75 per cent using it more than a year ago. ChatGPT and Copilot are the most popular tools, primarily for research, document analysis and meeting summaries. 58 per cent of respondents plan to increase AI usage in their investment process.

Despite the productivity gains, concerns persist. Eighty-three per cent cited data security as a risk, while 64 per cent worried about AI hallucinations. "You can't rely on it completely," says Odi Lahav of consultancy Bfinance. Sand Grove's Daniel Caplan emphasizes that human judgment remains essential: "Having a judgment layer that sits above AI is still very important."