Quantum Portfolio Optimization with Expert Analysis Evaluation

• URL: http://arxiv.org/abs/2507.20532v1
• Date: Mon, 28 Jul 2025 05:30:13 GMT
• Title: Quantum Portfolio Optimization with Expert Analysis Evaluation
• Authors: Nouhaila Innan, Ayesha Saleem, Alberto Marchisio, Muhammad Shafique,
• Abstract summary: This study systematically benchmarks two prominent variational quantum approaches, Variational Quantum Eigensolver (VQE) and Quantum Approximate Optimization Algorithm (QAOA)<n>Although both methods demonstrate effective cost function minimization, the resulting portfolios often violate essential financial criteria.<n>We introduce an Expert Analysis Evaluation framework in which financial professionals assess the economic soundness and the market feasibility of quantum-optimized portfolios.
• Score: 4.2435928520499635
• License: http://creativecommons.org/licenses/by/4.0/
• Abstract: Quantum algorithms have gained increasing attention for addressing complex combinatorial problems in finance, notably portfolio optimization. This study systematically benchmarks two prominent variational quantum approaches, Variational Quantum Eigensolver (VQE) and Quantum Approximate Optimization Algorithm (QAOA), under diverse experimental settings, including different asset universes, ansatz architectures, and circuit depths. Although both methods demonstrate effective cost function minimization, the resulting portfolios often violate essential financial criteria, such as adequate diversification and realistic risk exposure. To bridge the gap between computational optimization and practical viability, we introduce an Expert Analysis Evaluation framework in which financial professionals assess the economic soundness and the market feasibility of quantum-optimized portfolios. Our results highlight a critical disparity between algorithmic performance and financial applicability, emphasizing the necessity of incorporating expert judgment into quantum-assisted decision-making pipelines.

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