Is Prolog a good tool for this kind of problem?

From: Neil (njensen_at_habaneros.com)
Date: 04/14/04

  • Next message: Nameless: "Generating crossword frameworks" 
    Date: 13 Apr 2004 15:26:45 -0700

    We have an interesting potential project with a long-term client in
    the financial services industry. While I know that we can code this
    using a procedural approach, it tends to be pretty long and ugly.
    Based on skimming through some of the Prolog tutorials and docs, it
    appears as if Prolog might be a more efficient way to handle this type
    of problem.

    I'd appreciate any comments on this approach before we invest a lot of
    time into it. Thanks in advance.
     
     
    Scenario:
    Determine the transactions required to rebalance a portfolio of mutual
    funds so that the asset allocation matches a target allocation, while
    minimizing the overall tax burden triggered by the transactions.
     
    Details:
    A portfolios consist of one or more individuals who each own one or
    more accounts which each have one or more mutual funds.
     
    Individuals have different tax rates.
     
    Accounts may be of different types (e.g. taxable, non taxable). The
    different account types also have restrictions with respect to the
    amount of foreign content in the account. Buying and selling within a
    non-taxable account does not trigger capital gains, while taxable
    accounts are obviously subject to tax. If funds are sold at a loss
    less than 30 days after they are purchased, it is not possible to
    claim a loss on the sale. The gain (loss) on the sale of each mutual
    fund will depend on the current value and the adjusted cost base
    (similar to average cost of purchasing the funds).
     
    Each mutual funds belongs one or more asset class (e.g. equity,
    international equity, bonds, etc.). When more than one fund is in an
    asset class, a prioritized list is used to determine which funds are
    purchased to meet the target allocation.
     
    It is not required to meet the exact asset allocation target, instead,
    a target and a range is given (e.g. 20% +/- 3%).
     
    The goal is to generate a list of transactions within each account
    that will achieve the overall allocation while minimizing the overall
    tax bill.

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