Portfolio Optimization function calculates the optimal weights for a portfolio to achieve a target return. It uses historical data to allocate investments efficiently.

Portfolio Optimization

Purpose

The Portfolio Optimization function helps you optimize your investment portfolio to achieve a target return by adjusting the weights of different stocks in your portfolio.

Use Cases

• You want to achieve a specific target return on your investment portfolio.
• You want to adjust the weights of different stocks in your portfolio to optimize your returns.

How to Use

1. Enter the required input values.
2. Click on the "Optimize" button.
3. View the optimized portfolio with adjusted weights for each stock.

Input Values

1. CSV File: Upload a CSV file containing historical stock data.
2. Target Return: Enter the target return percentage you want to achieve.
3. Show Input: Check this box if you want to display the input data.

Output Values

1. Success: Indicates whether the optimization was successful.
2. Expected Return: The expected annualized return of the optimized portfolio.
3. Optimized Portfolio: The list of stocks with their optimized weights and average annual returns.
4. Log: Log of the optimization process.
5. Input Data: The original input data (if selected to be shown) or "Not Shown".

Any Other Instructions

• Make sure to upload a CSV file with historical stock data for accurate optimization.
• Adjust the target return percentage based on your investment goals.

Steps of Calculation

1. The function calculates the expected return of the portfolio using the weights of different stocks.
2. It optimizes the portfolio by adjusting the weights to achieve the target return.
3. The optimized portfolio with adjusted weights is then displayed.

Technical Parameters

• csv_file, target_return, show_input

Return Values

• Success, Expected Return, Optimized Portfolio, Log, Input Data

Example Expressions

You can use the following expressions to directly evaluate in a non-interactive manner using eval():

portf(csv_file=data.csv, target_return=0.25)
portf(csv_file=stock_data.csv, target_return=0.3, show_input=True)

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