Quantum Computing for Finance: State of the Art and Future Prospects

Abstract

This article outlines our point of view regarding the applicability, state-of-the-art, and potential of quantum computing for problems in finance. We provide an introduction to quantum computing as well as a survey on problem classes in finance that are computationally challenging classically and for which quantum computing algorithms are promising. In the main part, we describe in detail quantum algorithms for specific applications arising in financial services, such as those involving simulation, optimization, and machine learning problems. In addition, we include demonstrations of quantum algorithms on IBM Quantum back-ends and discuss the potential benefits of quantum algorithms for problems in financial services. We conclude with a summary of technical challenges and future prospects.

24 pages

References in corpus (37)

• Quantum Computing in the NISQ era and beyond
• Quantum Machine Learning
• A variational eigenvalue solver on a quantum processor
• Supervised learning with quantum enhanced feature spaces
• The theory of variational hybrid quantum-classical algorithms
• Quantum machine learning in feature Hilbert spaces
• Quantum Circuit Learning
• Quantum Amplitude Amplification and Estimation
• Quantum Algorithms Revisited
• Circuit-centric quantum classifiers
• Validating quantum computers using randomized model circuits
• Quantum computing for finance: overview and prospects
• Quantum optimization using variational algorithms on near-term quantum devices
• Roads towards fault-tolerant universal quantum computation
• Quantum machine learning: a classical perspective
• A Comprehensive Survey of Data Mining-based Fraud Detection Research
• Quantum Generative Adversarial Networks for Learning and Loading Random Distributions
• Quantum advantage with shallow circuits
• Quantum-state preparation with universal gate decompositions
• QAOA for Max-Cut requires hundreds of qubits for quantum speed-up
• Quantum Risk Analysis
• Quantum computational finance: Monte Carlo pricing of financial derivatives
• Amplitude estimation without phase estimation
• Improving Variational Quantum Optimization using CVaR
• Option Pricing using Quantum Computers
• Reachability Deficits in Quantum Approximate Optimization
• Optimal control, geometry, and quantum computing
• Performance of hybrid quantum/classical variational heuristics for combinatorial optimization
• Overview and Comparison of Gate Level Quantum Software Platforms
• Quantum Approximate Counting, Simplified
• Multistart Methods for Quantum Approximate Optimization
• Quantum SDP-Solvers: Better upper and lower bounds
• Experimental realization of 105-qubit random access quantum memory
• Multi-block ADMM Heuristics for Mixed-Binary Optimization on Classical and Quantum Computers
• Evaluating Quantum Approximate Optimization Algorithm: A Case Study
• Convex optimization using quantum oracles
• Regulatory Capital Modelling for Credit Risk

Cited by in corpus (77)

• Quantum computing for finance
• Warm-starting quantum optimization
• Grover Adaptive Search for Constrained Polynomial Binary Optimization
• Dynamic Portfolio Optimization with Real Datasets Using Quantum Processors and Quantum-Inspired Tensor Networks
• Scaling of the quantum approximate optimization algorithm on superconducting qubit based hardware
• Benchmarking the performance of portfolio optimization with QAOA
• A Threshold for Quantum Advantage in Derivative Pricing
• Simultaneous Perturbation Stochastic Approximation of the Quantum Fisher Information
• Pulse-efficient circuit transpilation for quantum applications on cross-resonance-based hardware
• Building a Quantum-ready Ecosystem
• A perspective on protein structure prediction using quantum computers
• Fast multi-qubit gates through simultaneous two-qubit gates
• The MQT Handbook: A Summary of Design Automation Tools and Software for Quantum Computing
• Variational quantum amplitude estimation
• Quantum Monte Carlo Integration: The Full Advantage in Minimal Circuit Depth
• Large-scale quantum approximate optimization on non-planar graphs with machine learning noise mitigation
• Comparative study of variations in quantum approximate optimization algorithms for the Traveling Salesman Problem
• Symmetry enhanced variational quantum spin eigensolver
• NP-hard but no longer hard to solve? Using quantum computing to tackle optimization problems
• Efficient quantum amplitude encoding of polynomial functions
• A Variational Quantum Attack for AES-like Symmetric Cryptography
• Step-by-Step HHL Algorithm Walkthrough to Enhance the Understanding of Critical Quantum Computing Concepts
• Minimum quantum run-time characterization and calibration via restless measurements with dynamic repetition rates
• Applying quantum approximate optimization to the heterogeneous vehicle routing problem
• The Problem with Grover-Rudolph State Preparation for Quantum Monte-Carlo
• Provable bounds for noise-free expectation values computed from noisy samples
• Calibrating the role of entanglement in variational quantum circuits
• Efficient Hamiltonian Simulation for Solving Option Price Dynamics
• Quantum Quantile Mechanics: Solving Stochastic Differential Equations for Generating Time-Series
• Quantum Monte Carlo simulations for financial risk analytics: scenario generation for equity, rate, and credit risk factors
• QDoor: Exploiting Approximate Synthesis for Backdoor Attacks in Quantum Neural Networks
• Quantivine: A Visualization Approach for Large-scale Quantum Circuit Representation and Analysis
• What can we learn from quantum convolutional neural networks?
• EHA: Entanglement-variational Hardware-efficient Ansatz for Eigensolvers
• Quantum Computing and Tensor Networks for Laminate Design: A Novel Approach to Stacking Sequence Retrieval
• Fully quantum algorithm for lattice Boltzmann methods with application to partial differential equations
• Optimizing Quantum Algorithms on Bipotent Architectures
• Quantum Approximate Optimization Algorithm for Test Case Optimization
• Natural orbitals and sparsity of quantum mutual information
• QOPTLib: a Quantum Computing Oriented Benchmark for Combinatorial Optimization Problems
• Quantum Financial Modeling on Noisy Intermediate-Scale Quantum Hardware: Random Walks using Approximate Quantum Counting
• Multi-Objective Optimization and Network Routing with Near-Term Quantum Computers
• LEP-QNN: Loan Eligibility Prediction using Quantum Neural Networks
• Expressivity of Variational Quantum Machine Learning on the Boolean Cube
• Quantum Information Driven Ansatz (QIDA): shallow-depth empirical quantum circuits from Quantum Chemistry
• Quantum autoencoders for image classification
• Quantum variational learning for entanglement witnessing
• Characterization of variational quantum algorithms using free fermions
• A novel approach for quantum financial simulation and quantum state preparation
• Quantum Quantitative Trading: High-Frequency Statistical Arbitrage Algorithm
• Synergistic Dynamical Decoupling and Circuit Design for Enhanced Algorithm Performance on Near-Term Quantum Devices
• Protocols for Trainable and Differentiable Quantum Generative Modelling
• Mitigating Errors on Superconducting Quantum Processors through Fuzzy Clustering
• Quantum Encoding and Analysis on Continuous Time Stochastic Process with Financial Applications
• Hybrid Quantum Machine Learning Assisted Classification of COVID-19 from Computed Tomography Scans
• Hardware-efficient entangled measurements for variational quantum algorithms
• Approaching Collateral Optimization for NISQ and Quantum-Inspired Computing
• Noise-Aware Quantum Amplitude Estimation
• Quantum Portfolio Optimization with Expert Analysis Evaluation
• Optimized QUBO formulation methods for quantum computing
• Quantum Computing for Data Centric Engineering and Science
• Bayesian Quantum Amplitude Estimation
• Contextual Quantum Neural Networks for Stock Price Prediction
• End-to-End Portfolio Optimization with Quantum Annealing
• Compact Multi-Threshold Quantum Information Driven Ansatz For Strongly Interactive Lattice Spin Models
• On the potential of quantum walks for modeling financial return distributions
• Introduction to Quantum Error Correction with Stabilizer Codes
• Higher-Order Portfolio Optimization with Quantum Approximate Optimization Algorithm
• Quantum Computational Insurance and Actuarial Science
• Adiabatic quantum computing with parameterized quantum circuits
• Approximate Quadratization of High-Order Hamiltonians for Combinatorial Quantum Optimization
• Analog quantum simulation of non-Condon effects in molecular spectroscopy
• Time series generation for option pricing on quantum computers using tensor network
• Exploring Non-Linear Programming Formulations in QuantumCircuitOpt for Optimal Circuit Design
• Large-scale portfolio optimization with variational neural annealing
• Grover Adaptive Search with Spin Variables
• Multiclass Portfolio Optimization via Variational Quantum Eigensolver with Dicke State Ansatz