Portfolio risk optimisation and diversification using swarm intelligence

Kingshuk Mazumdar, Dongmo Zhang, Yi Guo

Research output: Chapter in Book / Conference PaperConference Paperpeer-review

Abstract

![CDATA[The ongoing global economic turmoil has got the asset management industry look into new ways of financial risk management. Portfolio optimisation and risk budgeting are at the heart of most computational finance studies by academics and practitioners. In this paper, we introduce and analyse a method to construct an equity portfolio based on decomposition of marginal asset risk contribution of each stock in a given universe and then formulate a diversification problem for unsystematic risk as an optimisation problem. We have illustrated the performance of our method by comparing with another diversification technique, known as the Risk Parity portfolio, and then benchmark our results against the global major indices.]]
Original languageEnglish
Title of host publicationPRICAI 2019: Trends in Artificial Intelligence: 16th Pacific Rim International Conference on Artificial Intelligence, Cuvu, Yanuca Island, Fiji, August 26-30, 2019, Proceedings, Part III
PublisherSpringer
Pages740-747
Number of pages8
ISBN (Print)9783030298937
DOIs
Publication statusPublished - 2019
EventPacific Rim International Conference on Artificial Intelligence -
Duration: 13 Sept 2019 → …

Publication series

Name
ISSN (Print)0302-9743

Conference

ConferencePacific Rim International Conference on Artificial Intelligence
Period13/09/19 → …

Keywords

  • financial risk management
  • investments
  • risks
  • swarm intelligence

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