Optimization of Fund Periodic Investment Strategy Considering Frequency, Time Scale and Dynamic Payments
Investors in stock markets hope to have simple but valid investment strategy as a reference. Portfolios like mutual funds and their periodic payment plans hedge against the risk from stocks and time, respectively. In this study, for the sake of further reducing the risk of timing in a stock market, we optimize fund periodic investment strategy with consideration of frequency (period), time scale (number of payments) and dynamic payments (amount of a certain payment). Two strategies, Strategy I and Strategy II, are provided. The former does not include dynamic payments and is solved by enumeration; the latter includes dynamic payments and is solved by genetic algorithm (GA). Numerical simulation proves the effectiveness of both strategies and gives detailed analysis and comparison.
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Optimization of Fund Periodic Investment Strategy Considering Frequency, Time Scale and Dynamic Payments
Semantic Scholar · Business · 2020
Abstract
Investors in stock markets hope to have simple but valid investment strategy as a reference. Portfolios like mutual funds and their periodic payment plans hedge against the risk from stocks and time, respectively. In this study, for the sake of further reducing the risk of timing in a stock market, we optimize fund periodic investment strategy with consideration of frequency (period), time scale (number of payments) and dynamic payments (amount of a certain payment). Two strategies, Strategy I and Strategy II, are provided. The former does not include dynamic payments and is solved by enumeration; the latter includes dynamic payments and is solved by genetic algorithm (GA). Numerical simulation proves the effectiveness of both strategies and gives detailed analysis and comparison.