Research on Optimal Portfolio of Financial Investment Based on Genetic Algorithm

Abstract

The development of financial industry depends on capital from the real economy, manufacturing industry and service industry and so on, but also on optimal portfolio of investment itself. As the lifeblood of the whole national economy, the stability and development of the financial industry have exerted a great impact on the economic situation of one country. The shortage of funds have caused some difficulties to the production and management of major enterprises and hindered their rapid development. In the case of funds shortage, how to make the enterprises go beyond the limit of capital and maintain smooth operation rely on the method of genetic algorithm to study the optimal portfolio of financial investment. Investment incomes are maximized via the optimization and portfolio, while investment planning are dealt with genetic algorithm. This paper first describes the steps of genetic algorithm, explains in detail how to use genetic algorithm to make the optimal portfolio of financial investment, and then describes the application of genetic algorithm in financial investment planning of enterprises.