Maslow Portfolio Selection for Individuals with Low Financial Sustainability

• DOI: 10.3390/su10041128
• Publication Date: 2018-04-11T16:16:50Z
• Authors: Zongxin Li; Xinge Li; Yongchang Hui; Wing-Keung Wong
• Keywords: CVAR; Sample (material)

In this paper, we extend Maslow’s need hierarchy theory and the two-level optimization approach by developing framework of Maslow portfolio selection model (MPSM) solving two problems to meet individuals with low financial sustainability who prefer satisfy their lower-level (safety) first, and, thereafter, look for higher-level (self-actualization) maximize optimal return. We illustrate our proposed real American stock data from S&P index conduct out-of-sample analysis compare performance Variance-CVaR (conditional value-at-risk) MPSM both traditional mean-variance mean-CVaR models. Our empirical shows that is not only sustainable, but also obtains best in sense portfolios obtained using obtain highest cumulative returns period among models used paper. note suitable sustainability, institutions or investors high sustainability.