More than 80% of respondents said their firms allow them to use either external or internal generative AI tools to support their work.
ChatGPT ranked as the top choice among hedge fund managers for generative AI applications, followed by Bing and Bard.
The business functions of the industry most likely to be "significantly disrupted" by generative AI are research, information technology, legal and compliance, and investor relations.
Although portfolio management is an area in which generative AI has so far had a limited role, some 20% of larger hedge fund managers (those managing more than $1 billion) expect the technology to cause a "substantial disruption" in this sphere of the business within two years.
However, respondents also cited a number of challenges facing the widespread adoption of generative AI in hedge fund activities, including data security and privacy concerns, inconsistent responses, and the need for comprehensive staff training.
Moreover, only about 10% of respondents said they have received any training in generative AI — although nearly half of the larger hedge fund managers and 26% of smaller managers (those managing less than $1 billion) plan to offer such training within the next six months.
In addition, almost half (47%) of all respondents who are considering training in generative AI are exploring third-party services, thereby creating potential new opportunities for training providers.
About one-third of respondents think it would be important for some or all of their new hires to have some experience using generative AI tools.
"The very mention of the term AI sparks excitement and anxiety in equal measure, heralding the most significant disruption most of us are likely to witness in our lifetime," said Tom Kehoe, managing director and global head of research and communications at AIMA, in the report.
The report is based on a survey of 157 hedge fund managers around the world, as well as interviews with generative AI experts and industry leaders; the survey was conducted in December. The hedge fund executives manage an aggregate of $783 billion in assets, with average assets under management of $5 billion.