Insider Brief:
- DATEV and IQM Quantum Computers collaborated to explore the potential of quantum computing in optimizing DATEV’s product portfolio using a 20-qubit quantum system and the Markowitz model.
- IQM researchers tailored the Quantum Approximate Optimization Algorithm (QAOA) to address DATEV’s specific portfolio challenges, leveraging advanced transpilation techniques and highly connected quantum processing unit (QPU) topology for improved performance.
- The project demonstrated the effectiveness of quantum computing in complex optimization problems, with DATEV expressing optimism about the future potential of quantum technology and commending the performance of IQM’s superconducting quantum computers.
PRESS RELEASE — German software and IT service provider, DATEV, and IQM Quantum Computers (IQM), a global leader in superconducting quantum computers, have completed a collaborative project on the potential of quantum computing in portfolio optimisation using a 20-qubit quantum system.
In a published whitepaper, researchers at IQM and DATEV aimed to find the optimal resource allocation for their product portfolio, in respect to a given budget.
The goal was to optimise the approach to DATEV’s customers for their products by using the Markowitz model of portfolio optimisation. Originally, this model helps investors to reduce their risk by selecting a diversified portfolio of assets that do not fluctuate in tandem with the goal of finding the optimal mix of assets that provides the highest possible return for a given level of risk. However, the project has shown that the Markowitz model can also be effectively applied to manage and optimise DATEV’s product portfolio.
IQM researchers applied the Quantum Approximate Optimisation Algorithm (QAOA) to this portfolio optimisation problem, using the Markowitz model and encoding the investment decision as a combinatorial optimisation problem suitable for quantum computing.
In their collaboration, the IQM team developed a specific way to tailor QAOA to DATEV’s product portfolio optimisation challenge. “By using the data of DATEV to tailor the algorithm and by applying advanced transpilation techniques, we were able to achieve cutting-edge performance on our quantum hardware.” explained Dr. Elisabeth Wybo, the Team Leader Optimisation at IQM Quantum Computers.
The promising results were further enabled by IQM’s highly connected QPU topology, which is particularly well-suited for complex optimisation problems like portfolio selection, and its state-of-the-art two-qubit gate fidelities, ensuring high computational accuracy and reliability.
“As DATEV, we are engaged in the exciting technique of quantum computing, because we see a great potential in future years, and we have been impressed by the performance of IQMs superconducting quantum computers.” remarked Martin Braun, the Project Leader Quantum at DATEV.
