Abstract

MIRANDA ESPINOZA, Eva Luz; MUNOZ PALMA, Manuel  and  ALVAREZ CARRILLO, Pavel Anselmo. Hierarchical ranking of the Dow Jones index using the ELECTRE-III method. Vértice univ. [online]. 2022, vol.24, n.93, e43.  Epub Oct 17, 2022. ISSN 2683-2623.  https://doi.org/10.36792/rvu.v93i93.43.

The objective of the article is to present a multicriteria hierarchical process (MCHP) approach to decision making in the selection of stocks of the main companies of the Dow Jones index. One of the problems that investors often face is deciding which stocks should be included in an investment portfolio. The article allows investors to answer this question, through an MCHP approach and the ELECTRE III method using different criteria based on the financial relationships of profitability, liquidity, market, and efficiency. In this process, the investor generates a global ranking and a ranking of each subgroup of criteria regarding the investor’s preferences.

Keywords : Hierarchical multicriteria process; ELECTRE III; Financial ratios; Dow Jones.

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