Journal of Mathematical Finance, 2018, 8, 127-136
http://www.scirp.org/journal/jmf
ISSN Online: 2162-2442
ISSN Print: 2162-2434
DOI:
10.4236/jmf.2018.81011 Feb. 14, 2018 127
Journal of Mathematical Finance
Mathematical Model of Financial Investment
Risk
Deyu Yin
Rizhao Polytechnic, Rizhao, China
Abstract
This paper establishes the income and risk model in financial investment
based on multi-objective programming theory, aiming to analyze the rel
a-
tionship between risk and return in financial investment and discuss the rel
a-
tionship between the ris
k the investor shall bear and decentralization degree
of investment project. MATLAB software is used to analyze the investor’s o
p-
timized return under fixed risk level and the minimized risk with defined
benefit. In addition, it chooses the optimal portfoli
o under such risk level with
respect to the bearing capacity of different risks. This paper performs sensiti
v-
ity analysis of risk in income model using LINGO software, and puts
forward
the optimal portfolio for the investor without special preference. Calc
ulations
show that the model established is satisfactory in determining the optimal
portfolio.
Keywords
Multi-Objective Programming, Risk Measurement, Income Level, Sensitivity
Analysis, Optimal Portfolio
1. Introduction
Every investor cares about the risk and return of his/her investment in market
economy. Compared with the projects in general, venture investment is charac-
terized by the high investment, high risk, high return, in stages, timeliness and
other features. Many traditional items and new risk factors which haven’t ap-
peared in investment will be produced in the investment process due to these
characteristics. The new factors make the investors not only perform the con-
ventional investment feasibility analysis when choosing project, but also discuss
the source and constitution of the project implementation risk in-depth, and es-
timate the probability of risk and the potential damage to investor, so as to
How to cite this paper:
Yin, D.Y. (2018
)
Mathematical Model of Financial Inves
t-
ment
Risk.
Journal of Mathematical Finance
,
8
, 127-136.
https://doi.org/10.4236/jmf.2018.81011
Received:
January 17, 2018
Accepted:
February 11, 2018
Published:
February 14, 2018
Copyright © 201
8 by author and
Scientific
Research Publishing Inc.
This work is licensed under the Creative
Commons Attribution International
License (CC BY
4.0).
http://creativecommons.org/licenses/by/4.0/
Open Access
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