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Combinatorial optimization problems are ubiquitous and computationally hard to solve in general. Quantum approximate optimization algorithm (QAOA), one of the most representative quantum-classical hybrid algorithms, is designed to solve…

Quantum Physics · Physics 2024-03-12 Lixue Cheng , Yu-Qin Chen , Shi-Xin Zhang , Shengyu Zhang

Portfolio optimization (PO) is extensively employed in financial services to assist in achieving investment objectives. By providing an optimal asset allocation, PO effectively balances the risk and returns associated with investments.…

Quantum Physics · Physics 2024-07-09 Zhijie Tang , Alex Lu Dou , Arit Kumar Bishwas

Effectively encoding inequality constraints is a primary obstacle in applying quantum algorithms to financial optimization. A quantum model for Markowitz portfolio optimization is presented that resolves this by embedding slack variables…

Optimization and Control · Mathematics 2026-01-08 Pablo Thomassin , Guillaume Guerard , Sonia Djebali , Vincent Marc Lambert

The Quantum Approximate Optimization Algorithm (QAOA) has emerged as a promising variational quantum algorithm for addressing NP hard combinatorial optimization problems. However, a significant limitation lies in optimizing its classical…

Quantum Physics · Physics 2023-09-22 Peter Gleißner , Georg Kruse , Andreas Roßkopf

The quantum approximate optimization algorithm (QAOA) is known for its capability and universality in solving combinatorial optimization problems on near-term quantum devices. The results yielded by QAOA depend strongly on its initial…

Quantum Physics · Physics 2022-09-29 Xinwei Lee , Ningyi Xie , Yoshiyuki Saito , Dongsheng Cai , Nobuyoshi Asai

The quantum approximate optimization algorithm (QAOA) is a leading iterative variational quantum algorithm for heuristically solving combinatorial optimization problems. A large portion of the computational effort in QAOA is spent by the…

Quantum Physics · Physics 2022-08-23 Ohad Amosy , Tamuz Danzig , Ely Porat , Gal Chechik , Adi Makmal

In this note, we describe an experiment on portfolio optimization using the Quadratic Unconstrained Binary Optimization (QUBO) formulation. The dataset we use is taken from a real-world problem for which a classical solution is currently…

The Quantum Approximate Optimization Algorithm (QAOA) is a promising approach for programming a near-term gate-based hybrid quantum computer to find good approximate solutions of hard combinatorial problems. However, little is currently…

Quantum Physics · Physics 2018-11-21 Gavin E. Crooks

The Quantum Approximate Optimization Algorithm (QAOA) adopts a hybrid quantum-classical approach to find approximate solutions to variational optimization problems. In fact, it relies on a classical subroutine to optimize the parameters of…

Quantum Physics · Physics 2023-07-31 Simone Tibaldi , Davide Vodola , Edoardo Tignone , Elisa Ercolessi

Quantum optimization algorithms (QOAs) have the potential to fundamentally transform the application of optimization methods in decision making. For certain classes of optimization problems, it is widely believed that QOA enables…

Quantum Physics · Physics 2024-01-15 Florian Klug

In this work, we review quantum approaches to combinatorial optimization, with the aim of bridging theoretical developments and industrial relevance. We first survey the main families of quantum algorithms, including Quantum Annealing, the…

Quantum Physics · Physics 2026-03-20 Hala Hawashin , Deep Nath , Marco Alberto Javarone

In this work, we benchmark two prominent quantum algorithms: Quantum Imaginary-Time Evolution (QITE) and the Quantum Approximate Optimization Algorithm (QAOA) for obtaining the ground state of Ising-type Hamiltonians. Specifically, we apply…

Quantum Physics · Physics 2025-09-01 Ruizhe Shen , Zichang Hao , Ching Hua Lee

Quantum computation holds promise for the solution of many intractable problems. However, since many quantum algorithms are stochastic in nature they can only find the solution of hard problems probabilistically. Thus the efficiency of the…

Quantum Physics · Physics 2009-11-07 Sebastian Maurer , Tad Hogg , Bernardo Huberman

Currency arbitrage capitalizes on price discrepancies in currency exchange rates between markets to produce profits with minimal risk. By employing a combinatorial optimization problem, one can ascertain optimal paths within directed…

Computational Finance · Quantitative Finance 2025-02-25 Sangram Deshpande , Elin Ranjan Das , Frank Mueller

The efficient management of energy communities relies on the solution of the "prosumer problem", i.e., the problem of scheduling the household loads on the basis of the user needs, the electricity prices, and the availability of local…

Quantum Physics · Physics 2023-11-20 Carlo Mastroianni , Francesco Plastina , Luigi Scarcello , Jacopo Settino , Andrea Vinci

The quantum approximate optimization algorithm (QAOA) is a variational method for noisy, intermediate-scale quantum computers to solve combinatorial optimization problems. Quantifying performance bounds with respect to specific problem…

Quantum Physics · Physics 2021-11-30 Phillip C. Lotshaw , Travis S. Humble , Rebekah Herrman , James Ostrowski , George Siopsis

Portfolio optimization is one of the most studied optimization problems at the intersection of quantum computing and finance. In this work, we develop the first quantum formulation for a portfolio optimization problem with higher-order…

Quantum Physics · Physics 2026-01-28 Valter Uotila , Julia Ripatti , Bo Zhao

The quantum approximate optimization algorithm (QAOA) generates an approximate solution to combinatorial optimization problems using a variational ansatz circuit defined by parameterized layers of quantum evolution. In theory, the…

Quantum Physics · Physics 2021-09-24 Rebekah Herrman , Phillip C. Lotshaw , James Ostrowski , Travis S. Humble , George Siopsis

In recent years, Variational Quantum Algorithms (VQAs) have emerged as a promising approach for solving optimization problems on quantum computers in the NISQ era. However, one limitation of VQAs is their reliance on fixed-structure…

Quantum Physics · Physics 2026-03-03 Gloria Turati , Maurizio Ferrari Dacrema , Paolo Cremonesi

In this paper we tackle the problem of dynamic portfolio optimization, i.e., determining the optimal trading trajectory for an investment portfolio of assets over a period of time, taking into account transaction costs and other possible…