Using solver with constraints

**Hadoushi** · 03-11-2013, 05:52 PM

Hi there. I'm trying to create an investment portfolio using the following constraints

Security Returns
A B C D E
11% 18% 11% 17% 18%

I have $500 000 to invest subject to the following constraints:
The Total amount invested in A, B and C must be less than or equal to $100 000
D must Exceed C by at least $50 000
E must be 1.5 times D
At least $50 000 must be invested in A
No share must be more than half the total portfolio
There is no short selling

Given the above constraints, I need to find out how much is to be invested in A, B, C,D and E.

Any help on this would be tremendously appreciated.

**Alf** · 03-13-2013, 04:03 PM

Perhaps like this?

Alf

**Hadoushi** · 03-15-2013, 08:36 AM

Hi Alf. Thanks for your response.

I'm not certain if that is correct though since the constraints are applied after solver has solved everything, not before. This leads to a sum less than 500 000 when adding everything.

Also, there is no 'shorting', not that anything was less than 0 in your submission.

I've attached my own.

**Alf** · 03-15-2013, 10:09 AM

since the constraints are applied after solver has solved everything, not before.

Not sure what you mean by that. What you asked for and got was how to split up an investment according to a number of constraints. Personally I would have thought the aim was to maximize profit by buying shares according to given constraints.

Alf

**Hadoushi** · 03-15-2013, 08:17 PM

Thanks again Alf. Sorry if I'm coming across as unclear. I am still trying to master excel.

I'm just confused as to why I had so many constraints in my solver...