Maximizing returns on B3 stock investments through integer and binary programming strategies

Abstract

Abstract: Investment analysis in the stock market is essential for maximizing profits and minimizing risks. Thus, this article presents an integer programming model to optimize the financial returns of stocks traded on the Brazilian Stock Exchange (B3). The developed approach proposes an objective function focused on maximizing investments, based on the stock’s appreciation over time, considering both extraordinary payments, such as dividends and interest on equity, as well as stock price appreciation. The model uses binary and integer variables to structure the mathematical formulation, adhering to constraints such as the maximum investment value, permitted combinations, and risk limits defined by the investor. Additionally, this article outlines the components necessary for its computational implementation, using an explanatory flowchart, alongside the Python programming language and the Gurobi library