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Personalized fund recommendation with dynamic utility learning

Author

Listed:
  • Jiaxin Wei

    (Xi’an Jiaotong University)

  • Jia Liu

    (Xi’an Jiaotong University)

Abstract

This study introduces a fund recommendation system based on the $$\epsilon$$ ϵ -greedy algorithm and an incremental learning framework. This model simulates the interaction process when customers browse the web-pages of fund products. Customers click on their preferred fund products when visiting a fund recommendation web-page. The system collects customer click sequences to continually estimate and update their utility function. The system generates product lists using the $$\epsilon$$ ϵ -greedy algorithm, where each product on the list has the probability of 1- $$\epsilon$$ ϵ of being selected as an exploitation strategy, and the probability of $$\epsilon$$ ϵ is chosen as the exploration strategy. We perform a series of numerical tests to evaluate the estimation performance with different values of $$\epsilon$$ ϵ .

Suggested Citation

  • Jiaxin Wei & Jia Liu, 2025. "Personalized fund recommendation with dynamic utility learning," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 11(1), pages 1-27, December.
  • Handle: RePEc:spr:fininn:v:11:y:2025:i:1:d:10.1186_s40854-024-00720-5
    DOI: 10.1186/s40854-024-00720-5
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Personalized fund recommendation; $$epsilon$$ ϵ -greedy algorithm; Dynamic utility learning;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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