On September 29, IBM reported a study conducted together with the Vanguard financial asset management company in which quantum computing to optimize the construction of investment portfolios. The experiment pointed to one of the most demanding problems in the financial sector: to design portfolios that They meet real profitability and risk objectives following multiple restrictions. To do this, they applied a technique called «variational quantum algorithm based on sampling» (VQA), which combines quantum and classic resources To find approximate solutions to complex problems, according to the announcement.
How do these quantum «VQA» algorithms work and how was it applied in this experiment?
Quantum computers are not yet «perfect» or errors. However, there are already ways to take advantage of them combining them with classic computers.
One of these forms are the quantum variational algorithms (VQA), which They function as a «mixed team»: The quantum part explores a very large land of possibilities and the classic part is refining and correcting the results. These algorithms are trained step by step, using simple and flexible quantum circuits with techniques that reduce errors. That is why they are suitable for this initial stage of quantum computing. It is as if a rookie explorer used a drone (the quantum part) to see the entire map from above and then, with the help of a guide (the classic part), chose the best route. That idea, taken to the scope of the IBM and Vanguard experiment was carried out as follows: in the study 109 of the 133 cubits were used (the basic quantum calculation units, such as bits on a traditional computer) of a IBM quantum heron R1 IBM processor. In addition, circuits with up to 4,200 “logical doors” (basic quantum operations) were executed. After the quantum part took samples of the possible solutions, applied a classic method to polish and improve those results.
What was the result of the experiment?
The hybrid quantum-classical computing method was applied to the Construction of wallet wallets in the stock exchange (ETF) of bondsusing as a reference the classic solution called CPLEX, which optimally solves such problems on a reduced scale. The results revealed «promising metrics» and that «the flow of quantum-classical work consistently exceeded to a purely classic local search approach, especially when the size of the problem increased ». This superiority suggests that the integration of quantum and classic resources It could offer significant advantages in complex financial tasksopening on its way to future applications in asset management, although noise -related challenges still require attention, according to IBM statement. These tests with quantum and trading were not the first of its kind. As Cryptonotics explained on September 25, IBM had already worked with the HSBC bank in a quantum trading trial applied to bonds. The bank reported improvements to traditional methodswhich shows a growing interest of the financial sector in these technologies. As quantum computers grow and these algorithms mature, this hybrid combination could overcome classic methods in complex problems and with many restrictions.