Application of Linear Programming in Investment Portfolio Selection (Using Microsoft Excel 13)

The mathematical techniques are applicable to most of the field of studies including investment or portfolio selection decision. The linear programming technique is one of the techniques used in general finance. The research work was on the application of linear programming in investment portfolio selection decision. The main objective of the study was to examine how the Linear programming model is applied in portfolio selection decision using Microsoft excel 13. The data were obtained from practical example of portfolio selection with some constraints. The estimation techniques in the paper was linear programming and a prior expectation was that, if the constraints were minimize, the maximum return on investment. This is because, the linear programming have been used in the study and assisted in the portfolio selection with the maximum return on the investment particularly using Microsoft excel 13. It is concluded that, if the assumption and the formulation of linear programming model are accurately applied in portfolio selection can aid financial managers in decision making. It is recommended that, linear programming model should be applied in various aspect of finance and investment. Keywords: Linear Programming, Financial Management, Constraints, Maximum return, Stock