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A Portfolio Selection based on Hybrid of Interval<br />

Type-2 Fuzzy Logic and TOPSIS<br />

Zarith Sofea Binti Othman<br />

Supervisor: Dr. Binyamin Bin Yusoff<br />

Bachelor of Science (Financial Mathematics)<br />

School of Informatics and Applied Mathematics<br />

Portfolio selection is a complex process which involves the analysis of financial markets<br />

under uncertainty. The existence of various types of investors with different preferences<br />

also contributes to its complexity. Therefore, in this study, the Interval Type-2 Fuzzy Logic<br />

(IT2FL) model with TOPSIS is proposed to handle the complexity and uncertainty in the<br />

portfolio selection problem. The proposed model is tested on 25 companies listed on main<br />

board of the Kuala Lumpur Stock Exchange (KLSE). The input data is analyzed using<br />

MATLAB software with the IT2FL toolbox. It is shown that the hybrid model of IT2FL and<br />

TOPSIS is successfully applied in portfolio selection process to handle the aforementioned<br />

problems. Lastly, the significance of the study is to ease the investors in analyzing and<br />

ranking and decision strategies for worthy investments.<br />

908 | UMT UNDERGRADUATE RESEARCH DAY 2018

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