Genetic Algorithm Approach in Forming the Optimal Portfolio of Issuer Companies with Dividend Distribution Criteria

Abstract

Investing in the capital market for some investors is a challenge in itself. Investors are required to be able to determine the right combination and proportion of shares when they want to place a number of funds in each share that make up the optimal portfolio. The solution to the optimal portfolio formation problem can be done (Place holder) by using a genetic algorithm method approach. The purpose of applying genetic algorithms is to form an optimal portfolio with a proportion of stocks that can generate optimal profits with a justifiable loss rate. A case study was conducted on the companies compiling the LQ-45 index with dividend distribution criteria as many as 35 shares traded on the Indonesia Stock Exchange. The results showed that by using the genetic algorithm method, an effective problem solving was obtained in the formation of an optimal portfolio in issuers with dividend distribution.