Integrated Intellectual Investment Portfolio as an Efficient Instrument to Manage Personal Financial Investment

Aleksandras Vytautas Rutkauskas and Viktorija Stasytytė
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Aleksandras Vytautas Rutkauskas: Education Academy, Vytautas Magnus University, T. Ševčenkos Str. 31, 03111 Vilnius, Lithuania
Viktorija Stasytytė: Institute of Dynamic Management, Vilnius Gediminas Technical University, Saulėtekio Ave. 11, 10223 Vilnius, Lithuania

JRFM, 2022, vol. 15, issue 1, 1-22

Abstract: The redistribution of resources in global stock markets is prevalent: the capital is transferred from one investor to another. Sometimes, earning a substantial return in the stock market seems complicated to implement for an individual investor. Investing contributes to the welfare of society and the wealth of citizens. This is why people should look for efficient ways to invest. Investment should become a natural part of personal finance management in the majority of households. For this reason, an investment model is developed where stocks are selected based only on market intelligence using historical data. The model helps find one or several stocks that generate the highest return on a separate step. Applying this model, experiments were performed with daily data from German, US, and UK stock markets. The possibility of obtaining higher than average returns in these markets has been noticed. In the German market, during the 97-day period, the authors obtained a 1.46 return, which implies a 2.31 annual return: in the USA market, a 2.37 return (7.93 annual return), and in the UK market, a 1.90 return (4.09 annual return). Thus, the proposed investment decision-making system could be an efficient tool for forming a sustainable individual or household portfolio. It can generate higher investment returns for an investor and, moreover, make the market more efficient by applying market intelligence and related historical data.

Keywords: return; risk; stocks; stop-loss order; investment; portfolio (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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