Investment fund portfolio selection strategy in Lithuania

Abstract

The paper analyzes the problems of investment fund portfolio selection in Lithuania, giving the description of problem situation in the first part of the paper. Asset management is of the strategic importance for investment funds industry. By allocating savings to productive investment the asset management industry is a key for the overall functioning and development of the Lithuanian economy. Financial innovations, changes in investors' needs and preferences, and industry restructuring are transforming financial markets. In the investment funds industry the main driver of change is product engineering. The paper presents investment fund portfolio selection strategy and the results of its application, seeking for maximal gain in the Lithuanian capital market according to the scheme of daily portfolio rebalancing. The strategy has been applied on stocks of Vilnius Stock Exchange.