Mutual Information Maximizing Quantum Generative Adversarial Network and Its

Applications in Finance

Mingyu Lee∗
Department of Computer Science and Engineering,
Seoul National University, Seoul 08826, Korea and
QDQ Corp., Seoul 06999, Korea

Myeongjin Shin†
School of Computing, KAIST, Daejeon 34141, Korea and
QDQ Corp., Seoul 06999, Korea

Junseo Lee‡
School of Electrical and Electronic Engineering, Yonsei University, Seoul 03722, Korea and
Quantum Computing R&D, Norma Inc., Seoul 04799, Korea

Kabgyun Jeong§
Research Institute of Mathematics, Seoul National University, Seoul 08826, Korea and
arXiv:2309.01363v1 [quant-ph] 4 Sep 2023

School of Computational Sciences, Korea Institute for Advanced Study, Seoul 02455, Korea
(Dated: September 6, 2023)
One of the most promising applications in the era of NISQ (Noisy Intermediate-Scale Quantum)
computing is quantum machine learning. Quantum machine learning offers significant quantum
advantages over classical machine learning across various domains. Specifically, generative
adversarial networks have been recognized for their potential utility in diverse fields such as image
generation, finance, and probability distribution modeling. However, these networks necessitate
solutions for inherent challenges like mode collapse. In this study, we capitalize on the concept that
the estimation of mutual information between high-dimensional continuous random variables can
be achieved through gradient descent using neural networks. We introduce a novel approach named
InfoQGAN, which employs the Mutual Information Neural Estimator (MINE) within the framework
of quantum generative adversarial networks to tackle the mode collapse issue. Furthermore, we
elaborate on how this approach can be applied to a financial scenario, specifically addressing
the problem of generating portfolio return distributions through dynamic asset allocation. This
illustrates the potential practical applicability of InfoQGAN in real-world contexts.

I. INTRODUCTION this distinctive neural network design in various research

The integration of machine learning with finance has
yielded profound insights and ushered in transformative
applications in recent times. Driven by the rapid
expansion of available data and advancements in
computing capabilities, machine learning techniques have
triggered a revolutionary shift in the financial industry.
These techniques span across diverse areas such as
algorithmic trading [1–3], risk management [4–6], fraud
detection [7–9], and portfolio optimization [10, 11]. They
excel at making predictions and automating decision-
making processes within the intricate landscape of
finance. Amidst these advancements, the introduction
of Generative Adversarial Networks (GANs) [12] has
marked a significant turning point. These networks
have spurred a diverse array of innovative application
structures, underscoring the importance of exploiting
∗ Electronic address: red1108@snu.ac.kr
† Electronic address: hanwoolmj@kaist.ac.kr
‡ Electronic address: homology.manifold@gmail.com
§ Electronic address: kgjeong6@snu.ac.kr
endeavors [13–17]. Notably, InfoGAN [18] stands
out for its achievement in successfully extending
information theory. This extension empowers the
learning of disentangled representations via a fully
unsupervised approach, achieved by maximizing the
mutual information between a select subset of latent
variables and observational data.
In tandem with the growing interest in quantum
computing, a rising fascination with Quantum
Machine Learning (QML) has captivated researchers’
attention [19, 20]. This convergence of quantum
principles and machine learning has sparked an
impressive surge in research activities. Notably,
quantum machine learning techniques, including the
HHL algorithm for solving linear equations [21], the
QSVM for large-scale data classification [22], and the
kernel trick for effective QML in Hilbert spaces [23],
have all been subjects of intensive exploration. Each of
these techniques offers distinct advantages for processing
intricate data and solving complex problems within
the quantum domain. As a noteworthy extension, a
quantum version of the Generative Adversarial Network
(GAN), named QGAN, has also been introduced [24].

The theoretical demonstration that QGAN can offer an
exponential edge over classical GAN when dealing with
data composed of measurements in high-dimensional
spaces [25] has captured significant attention. Leveraging
these advantages, diverse research endeavors have
harnessed the potential of QGAN. This includes its
application in option pricing by employing methodologies
that learn random probabilities and map them onto
quantum states [26], addressing financial challenges
through modeling joint probability distributions [27], and
even image generation [28]. These studies collectively
highlight successful instances where QGAN has proven
its effectiveness.
In this paper, we introduce a novel quantum-classical
hybrid machine learning model called InfoQGAN .
Inspired by the integration of the idea of maximizing
mutual information between some latent variables
and observations in GAN, as seen in the structure
of InfoGAN, we aim to apply the same concept
to QGAN. Particularly, we intend to leverage the
efficient calculation of mutual information through neural
networks using MINE (Mutual Information Neural
Estimation) [29] within the framework of QGAN. We
intend to employ InfoQGAN to experimentally draw
the standard deviation-expected return diagram for
two assets derived through the Markowitz portfolio
theory. Our goal is to demonstrate that by utilizing
InfoQGAN, the modeling performance is significantly
enhanced compared to using QGAN alone.
The structure of our paper is as follows. In
Section II, we provide an explanation of the theoretical
background that underpins our results. Moving on to
Section III, we delve into the details of InfoQGAN,
where we elucidate the structure of QGAN, along
with the integration method involving MINE (Mutual
Information Neural Estimation). Section IV is dedicated
to describing experiments involving the utilization of
InfoQGAN for modeling two-dimensional probability
distributions. Notably, we experimentally demonstrate
its capability to address the mode collapse issue typically
observed in GANs. In Section V, we pivot towards
practical applications by employing InfoQGAN to tackle
a real-world financial problem, specifically the Markowitz
portfolio theory. We conduct experiments to generate
the standard deviation-expected return diagram. As we
proceed to Section VI, we outline the significance and
limitations of our study, along with prospects for future
plan. This concluding section encapsulates the essence
of our research.
II. PRELIMINARIES
A. Mutual Information
Mutual information serves as a quantitative measure
of the interdependence between random variables. The
mutual information I(X; Y ), defined by equation (1),
2
quantifies this relationship for two random variables, X
and Y , employing the principles of Shannon entropy [30]:
I(X; Y ) = H(X) − H(X|Y ). (1)
In this context, H(X) represents the Shannon entropy
of a random variable X, while H(X|Y ) signifies the
conditional entropy of variable Y given the value of
variable X. The joint distribution of the pair of random
variables (X, Y ) across the space X × Y, along with
their marginal distributions PX and PY , is defined.
These entropy measures are formally articulated as
equations (2) and (3) in the form of
X
H(X) = − p(x) log (p(x)) and (2)
x∈X
X 
pX,Y (x, y)

H(X|Y ) = − pX,Y (x, y) log .
pY (y)
x,y∈X×Y
(3)
Furthermore, the interpretation of mutual information
extends to Kullback-Leibler divergence [31], wherein DKL
symbolizes the Kullback-Leibler divergence and PX ⊗ PY
represents the outer product distribution, assigning a
probability of PX (x) · PY (y) to each (x, y). This mutual
information can be succinctly formulated as
I(X; Y ) = DKL (PX,Y ||PX ⊗ PY ). (4)
Several methodologies have been proposed to estimate
this measure, with the Mutual Information Neural
Estimator (MINE) [29] standing out as a successful
approach.
B. Mutual Information Neural Estimation (MINE)
The Mutual Information Neural Estimator (MINE),
which was introduced by Belghazi and colleagues in
their research [29], constitutes a parametric methodology
exploiting the capabilities of neural networks to
approximate mutual information. This strategy employs
neural networks with the aim of minimizing a specialized
loss function tailored to quantify mutual information
effectively. The construction of this loss function is
deduced from the underlying principles of the Donsker-
Varadhan representation [32]. This representation is
elucidated through equation (5), wherein F denotes an
arbitrary class of functions T : Ω → R. Notably, P and Q
are used to denote two distributions, assuming that these
distributions are defined within a confined domain Ω ⊂
Rd , each characterized by probability density functions p
and q correspondingly, relative to the Lebesgue measure,
DKL (P||Q) ≥ sup EP [T ] − log EQ eT .
 

(5)
T ∈F

The Donsker-Varadhan representation enables the
expression of MINE, and through sampling, the
expectation terms in the aforementioned equation (5) are
computed to update mutual information. By sampling
using a minibatch of size n, the equation above can be
represented as an estimate of mutual information I, as
demonstrated by
Z)n ≥ sup EPXZ [Tθ ] − log EPX ⊗PZ eTθ .
 

\
I(X;
θ∈Θ
In this context, the parameterized neural network Tθ
comes into play. It has been established that I(X; Z) ≤
\
I(X; Z)n , creating a foundation for training the neural
network to maximize I(X; \ Z)n . This optimization
process, in turn, facilitates the estimation of mutual
information. Furthermore, the strong consistency of
MINE has been rigorously demonstrated through a
compelling proof [29, Theorem 5]. This theorem
establishes the existence of a positive integer N and a
set of neural network parameters θ ∈ Θ for which, given
∀n ≥ N , the inequality I(X; Z) − I(X; \ Z)n ≤ ε holds
true for all values of ε > 0.
C. (Quantum) Generative Adversarial Networks
The Generative Adversarial Network (GAN) [33]
stands as a machine learning framework wherein two
neural networks engage in a competitive interplay,
akin to a zero-sum game, with the objective of
generating new data that resembles a predefined training
dataset. Originally conceived as a generative model
for unsupervised learning, GANs have demonstrated
their utility across diverse learning paradigms. At the
heart of this concept lies a generator that is trained
through dynamic adjustments to outwit a discriminator,
rather than being directly optimized for specific images.
Through adversarial learning, the classification and
generation models iteratively refine one another, enabling
the generator to craft highly authentic data that
is indistinguishable from real data by consistently
confounding the discriminator’s classification ability.
The structural framework of GANs is illustrated in
Figure 1. The GAN learning process is cast as a minmax
problem, encapsulated by
min max V (D, G) =
G D
Ex∼pdata (x) [log D(x)] + Ex∼pz (z) [log(1 − D(G(z)))],
where D(x) represents the classifier’s evaluation of
real data, and D(G(z)) gauges the authenticity of the
generated data.
Incorporating the principles of quantum mechanics,
a Quantum Generative Adversarial Network (QGAN)
expands the scope of the traditional Generative
3
(6)
FIG. 1: The basic structure of a Generative Adversarial
Network (GAN).
Adversarial Network (GAN) framework into the realm
of quantum computing. GANs consist of a generator
and a discriminator, where the generator fabricates
data instances that mirror the training data, while
the discriminator distinguishes genuine data from
synthesized counterparts. In the quantum domain,
a QGAN harnesses quantum states and operations
to both learn and generate quantum data. The
quantum generator employs a quantum circuit to map
a latent space onto a data space. The quantum
discriminator, whether manifested as a quantum circuit
or a conventional neural network, discerns between
authentic and generated quantum data, necessitating an
initial measurement step for processing. By capitalizing
on the tenets of quantum mechanics, the QGAN imitates
and manipulates quantum states, potentially augmenting
the generation of quantum data in comparison to classical
techniques. It is noteworthy that QGANs are an
evolving area of study, with practical implementations
on quantum computers confronting obstacles such as the
management of noise and error correction. Additionally,
the structural aspects of the QGAN employed in our
experiment will be elaborated upon in Section III.
D. InfoGAN
InfoGAN [18] extends the concept of GAN to
encompass unsupervised learning through the utilization
of mutual information. The core notion revolves around
maximizing the mutual information between the output
of the generator and a subset of latent codes, which,
together with noise, act as inputs to the generator. This
strategic manipulation of latent codes enables them to
(7)
influence the unsupervised behavior of the generated
output.
Unlike traditional GANs where only noise z serves
as input for the generator, InfoGAN introduces the
latent code c as an additional input, transforming
the generator’s distribution to G(z, c). The primary
objective of InfoGAN is to maximize the mutual
information I(c; G(z, c)), achieved by altering the loss
function of the minimax game as defined by

min max VI (D, G) = V (D, G) − λI(c; G(z, c)). (8)
G D
Note that the MINE had not been published at the
time, the InfoGAN introduced a lower bound to estimate
I(c; G(z, c)), employing it for GAN training as follow:
I(c; G(z, c)) ≥ Ex∼G(z,c) Ec′ ∼P (c|x) [log Q(c′ |x)] + H(c).
 
(9)
Here, Q(c|x) functions as an auxiliary distribution
approximating P (c|x). A recognition network, which
shares much of its structure with the discriminator
while differing only in the final layer, is employed
to parameterize Q. Empirical results showcase the
efficacy of InfoGAN in disentangling writing styles from
digit shapes within the MNIST dataset. Additionally,
it demonstrates the discovery of visual concepts such
as hairstyles, eyeglasses, and emotions, along with
the ability to discern pose variations due to lighting
conditions in 3D rendered images.
E. Modern Portfolio Theory (MPT)
The emergence of Modern Portfolio Theory (MPT),
pioneered by Harry Markowitz in the 1950s [34], ushered
in a paradigm shift in the realm of investment. This
groundbreaking framework introduced a quantitative
approach to portfolio construction, fundamentally
altering how investments are approached. At its
core, MPT is concerned with the optimization of
investment decisions, meticulously weighing the interplay
between risk and return. This theory rests on a
fundamental tenet: the delicate equilibrium between
risk and reward. By quantifying the inherent risk and
potential return associated with various investments,
MPT provides investors with a coherent methodology
for making informed choices. This principle essentially
posits that investors aspire to maximize returns within
a stipulated risk threshold or minimize risk while
striving for a predefined level of return. Central to
MPT are the statistical descriptors characterizing the
returns of assets—specifically, their mean (or expected
returns) and standard deviation (or volatilities). These
parameters eloquently encapsulate the amplitude of
price fluctuations that assets undergo. This nuanced
understanding of asset behavior serves as the cornerstone
for shaping portfolios that deftly balance the intricate
dynamics of risk and reward.
1. Expected Returns and Volatility
In the realm of portfolio management, we direct our
attention to a composite of two distinct assets, identified
as A and B. These assets come with anticipated returns,
4
denoted as µA and µB , and are characterized by their
respective standard deviations, represented as σA and
σB . Furthermore, we track the returns of these assets,
denoted as RA and RB . In a common modeling approach,
these asset returns are modeled as random variables and
often exhibit a normal distribution. Of particular interest
is the computation of the standard deviation pertaining
to the portfolio’s return, which is formulated as
q
σp = 2 σ 2 + w 2 σ 2 + 2w w ρ
wA
A B B A B AB . (10)
In this context, the symbols wA and wB take on
significance as the designated portfolio weights assigned
to assets A and B, respectively. Importantly, the
constraint wA + wB = 1 is preserved, underscoring
the allocation of resources. Additionally, the term
ρAB = Cov(RA , RB ) captures the covariance between
the returns of assets A and B, thus encapsulating the
dynamic interaction embedded within their respective
returns. This covariance plays a pivotal role in assessing
the interrelationship and diversification potential of these
assets within the portfolio framework.
2. The Mean-Standard Deviation Diagram
The utilization of the mean-standard deviation
diagram continues to be a commonly employed technique
for visually depicting portfolios, a characteristic often
observed in the domain of portfolio management. This
methodology finds particular relevance in the context
of portfolios comprised of dual assets. Notably,
instances arise where a reduction in risk aligns with
the achievement of an equivalent level of return.
This phenomenon is delineated in accordance with the
formulation presented in equation (10). Within these
contextual frameworks, the graphical representation
takes on a concave disposition towards the left quadrant,
effectively elucidating this intricate interrelation. For
further visual reference, we consult Figure 2 below.
FIG. 2: The mean-standard deviation diagram depicts
two assets, labeled as A and B.

III. INTEGRATION OF QGAN AND MINE
We propose a novel quantum machine learning
framework that seamlessly integrates the QGAN and
MINE methodologies. Our endeavor commences with
the introduction of an enhanced generator design. This
specialized generator, when supplied with a stochastic
noise vector z, orchestrates the creation of an initial state
represented as UI (z)|0⟩. Following this initialization,
as the generator undergoes the intricacies of the ansatz
process, its terminal state elegantly transforms into the
expression UG (θ)UI (z)|0⟩.
Within the scope of this study, meticulous attention
has been devoted to the composition of each layer.
Arranged in sequence, these layers encompass a
combination of RX, RY, RZ (Rotation-X, Y, and Z)
operations, intricately interwoven with strategically
positioned CNOT gates. These CNOT gates adeptly
facilitate interactions spanning from the initial to the
final qubits, while also extending their influence across
all adjacent qubits. For a comprehensive exploration
of the nuanced framework that shapes the ansatz, we
refer Figure 3. (The circuit can be subject to various
modifications, and it should be noted that for the
experiments conducted in Section V, certain circuit
structures differed.)
RX RY RZ •
RX RY RZ • distribution and subsequently compared the performance
• framework. The generator of a GAN is trained to
RX RY RZ
RX RY RZ •
FIG. 3: Generator ansatz corresponding to 4-qubit
quantum circuit.
In the final state, we measure the expectation
values {⟨Oj ⟩} of local and nonlocal observables. The
values F1 ({⟨Oj ⟩}), F2 ({⟨Oj ⟩}), ..., FN ({⟨Oj ⟩}) obtained
by passing through activation functions Fi : Rn →
R, where N is the dimensionality, constitute the N -
dimensional output produced by the ultimate generator.
For convenience, let’s denote {fi } = {Fi ({⟨Oj ⟩})}. The
model’s output is defined as G(z) = {fi }. To ensure the
activation functions can be applied within a quantum
computer, they must support gradient calculations
through the parameter shift rule [35, 36]. Moreover,
since quantum circuits involve linear transformations, the
activation functions must also be nonlinear to introduce
nonlinearity.
Let us now proceed to select a subset of the noise vector
z as the code, designating the remaining portion as the
noise variable. This separation can be represented as
z = (ϵ, c), where ϵ represents the noise and c represents
5
the code. Both the discriminator and the MINE model
operate as classical neural networks. The MINE model
takes (c, {fi }) as its input and generates an estimation of
mutual information. The QGAN, Discriminator model,
and MINE model are concurrently trained at each epoch.
It is important to reiterate that the generator’s loss
function is adjusted according to
max E(z,c)∼p(z,c) [log D(G(z, c)) + β · MINE(c, G(z, c))],
G
(11)
while the loss functions for the other models remain
unchanged.
InfoGAN demonstrated that by separating a small
subset of latent variables given as input into a code, and
maximizing the mutual information between the code
and the model’s output, one can control the attributes
of the data generated through the code. The manner
of calculating mutual information in InfoGAN, which is
based on maximizing, can be replaced by using MINE.
Hence, although our model is a combination of MINE and
QGAN, we will refer to it as InfoQGAN , signifying a
Mutual Information Maximizing QGAN.
IV. INFOQGAN FOR GENERATING 2D
DISTRIBUTIONS
We employed InfoQGAN to generate a predefined 2D
of QGAN and InfoQGAN within this experimental
deceive the discriminator, while the discriminator is
trained not to be fooled by the generator. Thus,
GAN employs a minimax optimization approach, which
contributes to the difficulty in training both the generator
and discriminator, ultimately leading to the issue of
mode collapse [37–43]. This phenomenon involves the
generator generating a limited distribution with reduced
variety.
MINE [29] introduced a technique where the
generator’s input, denoted as z = (ϵ, c), is partitioned
into two components: noise ϵ and code c variables. This
separation aims to maximize the mutual information
between G(ϵ, c) and c. This approach effectively
addressed the issue of mode collapse in GANs designed
for generating 2D distributions. This study underscores
the effectiveness of InfoQGAN in mitigating mode
collapse in QGANs. Furthermore, the utilization of the
code variable empowers us to exert control over certain
properties within the generated data distribution. The
input noise is symbolized as z ∈ [−1, 1]n , and it is
integrated into the generator circuit through a noise
embedding process, referenced as
n  πz 
i
Y
UI (z) = RYi , (12)
i=1
2
 6

distributions, we utilize the two-dimensional two-sample

Kolmogorov-Smirnov (KS) test [45]. In this context, the
null hypothesis of the two-sample KS test states that
the two datasets are drawn from the same underlying
distribution. Conversely, the alternative hypothesis
suggests that the datasets originate from different
distributions. For this analysis, a significance level of
0.05 is employed.

A. Reducing Mode Collapse

(a) Biased Circle
The first experiment aims to address the issue of
mode collapse. We refer to Table I for the probability
distribution being modeled and the overall settings of
the experiment. Statistical analysis of the experimental
results is presented in Table II, and upon review, it
becomes clear that InfoQGAN outperforms QGAN in
terms of performance enhancement. This advantage
is attributed to the smaller KS value and larger p-
value of InfoQGAN. Figure 5 visually encapsulates these
results. The prevalence of mode collapse in the output of
QGAN is evident, whereas InfoQGAN remains resilient
to this issue. The robustness of InfoQGAN against mode
(b) Central Square collapse is further substantiated by consistently yielding
a p-value exceeding 0.05 during training epochs, thereby
FIG. 4: The target distribution to be modeled for the preventing such occurrences with high probability. In
experiment. contrast, the p-value of QGAN rarely exceeds the

wherein RY (θ) signifies the RY gate, i.e., a rotation-Y Experimental Settings QGAN InfoQGAN
gate operating on a single qubit with an angle of θ. The Points 2000
objective is to generate a two-dimensional distribution Target Domain [0, 1] × [0, 1]
where the x-coordinate is extracted from the first qubit
Distribution Center (0.3, 0.3)
and the y-coordinate from the second qubit. In the
case of i ∈ {1, 2}, where Pi signifies the measurement Shape Figure 4a
probability of the i-th qubit being 0, the generator output Learning Rate 0.001
is given by Generator Optimizer Adam
(G) Scheduler Step Size 30
4 p  1
sin−1 Pi − . (13) Gamma 0.7
π 2
Learning Rate 0.0003
The generator G takes the form of a variational Discriminator Optimizer Adam
quantum circuit and is trained through classical (D) Scheduler Step Size 30
backpropagation within a quantum circuit simulator. If Gamma 0.85
the generator circuit is executed on a physical quantum
Mutual Information Learning Rate 0.001
processor, the training procedure could also incorporate
techniques such as the parameter shift rule or SPSA [44], Neural Estimator Optimizer - Adam
Scheduler Step Size 30
which do not necessitate backpropagation. Both the (MINE)
discriminator D and MINE models are constructed as Gamma 0.7
classical feed-forward neural networks and were also Training Epoch 300
trained using classical backpropagation. To streamline Layers 20
the training process and mitigate complexity, we adopted Noise (ϵ) 5 3
stochastic gradient descent. In each epoch, a subset Qubits
Code (c) - 2
comprising 25% of samples from the distribution was
selected for mini-batch training. Refer to Table I and III β in Loss Function (Equation (11)) - 0.5
for the experimental setup, including hyperparameters
TABLE I: Details of the experimental settings for the
related to training and target probability distributions.
experiment Reducing Mode Collapse.
To determine the equivalence of the generated point
 7

code values. In the case of QGAN, these code values

are represented by the last two noise values. The
InfoQGAN demonstrates a clear correlation between x,
y coordinates and code values, which is not evident in
QGAN. This indicates that codes within InfoQGAN are
more effective at capturing and controlling features in
generated outputs.
This inference is further substantiated by Figure 8
and Figure 9. They show that codes within InfoQGAN
can capture features more effectively than those within
QGAN. Visually, it appears that the first code value of
InfoQGAN captures y-axis features while its second value
(a) QGAN
accounts for those along the x-axis. This observation
aligns with what we see from InfoQGAN’s epoch-
correlation graph shown in Figure 7. In contrast, codes
within QGAN do not perform as well when it comes to
effectively capturing these features.
In Figure 9, when using InfoQGAN, the two codes
capture features in orthogonal directions. This same
phenomenon can be observed in another example
obtained under identical settings, as shown in Figure 10.
From these observations, we propose a conjecture that
to maximize mutual information with two codes, it may
be optimal for them to represent features in orthogonal
(b) InfoQGAN directions.

FIG. 5: A comparison demonstrating that QGAN,

without the maximization of mutual information,
experiences mode collapse in contrast to InfoQGAN in
the context of a biased circle example.
Experimental Settings QGAN InfoQGAN
Model DKS p-value Points 2000
Target Domain [0, 1] × [0, 1]
QGAN 0.09 0.002
Distribution Center (0.5, 0.5)
InfoQGAN 0.06 0.3
Shape Figure 4b
TABLE II: Comparison of accuracy using DKS and the Learning Rate 0.001
p-value from the Kolmogorov-Smirnov (KS) test. Generator Optimizer Adam
(G) Scheduler Step Size 30
Gamma 0.7
0.05 threshold. Notably, the output of InfoQGAN Learning Rate 0.0003
exhibits a visually uniform distribution. Our experiment Discriminator Optimizer Adam
underscores the significant advantage of InfoQGAN over
(D) Scheduler Step Size 30
QGAN in mitigating mode collapse. Both statistical
analysis and visual evidence demonstrate the robustness Gamma 0.85
and superior performance of InfoQGAN, underscoring its Mutual Information Learning Rate 0.001
potential to enhance reliability in generative models. Neural Estimator Optimizer - Adam
Scheduler Step Size 30
(MINE)
Gamma 0.7
B. Controlling Generated Features Training Epoch 300
Layers 5
The primary objective of the second experiment is to Noise (ϵ) 5 3
investigate the ability to control features in generated Qubits
Code (c) - 2
outputs. For a detailed understanding of the probability
distribution being modeled and an overview of the β in Loss Function (Equation (11)) - 0.1
experimental settings, we refer to Table III.
TABLE III: Details of the experimental settings for the
Also, Figure 7 illustrates the correlation between x, y
experiment Controlling Generated Features.
coordinates of generated points and their corresponding
 8

(a) QGAN (a) QGAN

(b) InfoQGAN (b) InfoQGAN

FIG. 6: The graph represents the trend of the FIG. 7: The graph illustrates the trend of correlation
generator, discriminator, and mutual information between the x, y-axes and codes 0, 1 during the training
during the training process. process.
 9

(a) Generated by QGAN (a) Generated by InfoQGAN

(b) Code 0 (b) Code 0

(c) Code 1 (c) Code 1

FIG. 8: Scatter plot representing the distribution of FIG. 9: Scatter plot representing the distribution of
points generated using QGAN and the separation of points generated using InfoQGAN and the separation of
features according to codes. It can be observed that the features according to codes. It can be seen that the
feature separation is not well executed. feature separation is distinctly taking place.
 10

Experimental Settings QGAN InfoQGAN

Assets APPL, TSLA
Learning Rate 0.0004
Generator Optimizer Adam
(G) Scheduler Step Size 30
Gamma 0.7
Learning Rate 0.00004
Discriminator Optimizer Adam
(D) Scheduler Step Size 30
Gamma 0.7
Mutual Information Learning Rate 0.001
Neural Estimator Optimizer - Adam
(a) Code 0 Scheduler Step Size 30
(MINE)
Gamma 0.7
Training Epoch 450
Layers (Parameters) 5 (24)
Noise (ϵ) 4 3
Qubits
Code (c) - 1
β in Loss Function (Equation (11)) - 0.15

TABLE IV: Details of the experimental settings for the

experiment Creating Portfolio Return Distributions via
Dynamic Asset Allocation.

(b) Code 1

FIG. 10: Scatter plot representing the generation

results through another InfoQGAN and the feature
separation lines for each code. In numerous repeated
experiments, all trials showed the characteristic of
feature separation lines being orthogonal to each other.
This can be speculated that the reason is because
orthogonal directions can maximize mutual information
for two codes.
(a) Cumulative Growth of Daily Returns

V. CREATING PORTFOLIO RETURN

DISTRIBUTIONS VIA DYNAMIC ASSET
ALLOCATION

When we explore the amalgamation of two distinct

assets in diverse proportions to create a portfolio,
a fascinating pattern emerges in the mean-standard
deviation space. This mix specifically sketches a curve
that joins the points denoting each of these primary
assets. This curve serves as a graphical interpretation (b) Histogram of Daily Returns
of possible risk-return compromises associated with
different portfolio structures. FIG. 11: Historical growth of a $10,000 investment in
AAPL and TSLA from January 1, 2011 to December
31, 2022 is shown alongside a histogram of the daily
return distributions for both stocks over the same
period. The histogram is represented using 16 bins.
 11

FIG. 13: An ansatz for generating the probability

density function corresponding to 4 qubits.

(a) QGAN vs. InfoQGAN

(a) QGAN

(b) QGAN

(b) InfoQGAN

FIG. 12: The graph represents the trend of the

generator, discriminator, and mutual information
during the training process. It is evident that both (c) InfoQGAN
QGAN and InfoQGAN have been trained stably.
FIG. 14: This visualization represents the distribution
obtained by dividing the code values into 16 segments
within [0, 1], and randomly batching the remaining
noise variables 512 times in the mean-standard
deviation space. It concurrently illustrates and allows
for comparison of results from both QGAN and
InfoQGAN.

Additionally, it’s feasible to compute essential
statistical indicators for both these standalone assets
and the consolidated portfolio. These indicators
encompass mean daily returns and standard deviation
of daily returns, which are derived from their individual
distributions of daily return. These insights shed light on
anticipated performance and fluctuation levels. Grasping
these metrics is vital for making knowledgeable decisions
in investment management, as they furnish critical data
regarding potential investment results under varying
market scenarios.
Figure 11 displays the distribution of daily returns
for Apple and Tesla over the span from 2011 to 2022.
As discernible from a histogram with 16 bins, Tesla
demonstrates greater volatility than Apple, along with
superior average returns. If the return series for Apple
within this time-series data is represented as RiA , and
that for Tesla as RiT , then the return series of a
portfolio constructed by amalgamating these assets in
proportions α and 1 − α, respectively, would be denoted
as αRiA + (1 − α)RiT . The mean return and standard
deviation of this combined portfolio can be readily
computed from this information.
In this experiment, we devise a generator circuit
with the specific aim of generating the daily return
distribution of a portfolio, which is constituted through
the amalgamation of two assets. The distribution
is truncated to [−0.1, 0.1] and discretized using 2n
grid points, where n represents the number of qubits
employed. The unitary operator within the generator
transforms the given input as follows:
n
2X −1
√ there is a high probability of return values around 0.
|0⟩n → pi |i⟩n (14)
i=0
Here, |i⟩ corresponds to the discretized interval [0.1+ 0.2
2n ·
0.2
i, 0.1 + 2n · (i + 1)], which lies within [−0.1, 0.1].
We employed daily return data for Apple (AAPL)
and Tesla (TSLA) spanning from 2011 to 2022 as the
foundation of our raw training dataset. The generator,
in this case, is implemented as a 4-qubit quantum circuit,
meticulously segmenting the [−0.1, 0.1] range into 16
distinct sections. This segmentation process facilitates
the extraction of probability distribution data from the
training dataset. By denoting the weight assigned to
AAPL’s performance as α and TSLA’s weight as 1−α, we
generated a total of 2000 return probability distribution
datasets. This was achieved by uniformly partitioning
the interval [0, 1] into 1000 segments to create one
dataset, and then separately repeating this procedure
a thousand times. On each repetition, a value was
uniformly selected from within the [0, 1] range. The
generator circuit underwent a training process with the
aim of aligning the resulting probability distribution pi
of the output state with the probability distribution of
portfolio returns. Taking inspiration from the structure
of QGAN [26], which addresses analogous problems, we
12
devised our generator circuit, visually represented in
Figure 13. The range of the noise is [0, 1], and the noise
embedding circuit has been structured according to
n
π(zi − 0.5)
 
Y
UI (z) = RYi . (15)
2
i=1
This design corresponds to the Rotation-y gates located
at the forefront of Figure 13. We refer to Table IV for
the detailed structure of the model and experimental
settings.
In Figure 14, return distributions generated by
modifying code values within the finalized model have
been depicted in the mean-standard deviation space.
For InfoQGAN, the graph manifests a concave shape
towards the left, as the proportions of the two assets
change. This outcome aligns with the successful learning
described in Section II E, reminiscent of Figure 2, where
the Markowitz theory can be aptly explained. However,
QGAN did not exhibit such behavior. Furthermore, in
the case of QGAN, adjusting code values only resulted in
learning return distributions with mean values confined
to a highly restricted interval, specifically within the
range [0.0004, 0.0009]. In contrast, InfoQGAN showcased
a significantly broader range of mean values, spanning
approximately 9 times wider, falling within the interval
[0.0005, 0.0040]. This outcome can also be interpreted
as the resolution of mode collapse, providing further
validation for the conclusions presented in Section IV A.
Through Figure 15, it is possible to confirm the
portfolio return distribution generated by InfoQGAN. By
observing the shape of the histogram, it can be seen that
Furthermore, as the code value increases, it is noticeable
that the probability of the portion where the absolute
value of the return is greater than 0.5 also increases. This
phenomenon is presumed to occur due to the adjustment
of the portfolio variance, which is changed by the code,
during the process of mutual information maximization.
VI. DISCUSSION AND CONCLUSIONS
Our work has proposed a quantum-classical hybrid
version of InfoGAN [18]. Experimental results indicate
that InfoQGAN is also effective in mitigating mode
collapse and enables control over generated features,
much like InfoGAN. Moreover, applying InfoQGAN in
a financial context has yielded promising outcomes.
In future research, we intend to conduct experiments
using noisy quantum circuit simulators and real quantum
hardware. Exploring alternative embedding strategies
may yield improved results. Additionally, investigating
methods to leverage quantum mutual information
instead of classical mutual information presents an
intriguing avenue. This has the potential to enhance the
likelihood of achieving quantum advantage, particularly
 13

FIG. 15: The distribution is generated by the trained generator G. The code c values are uniformly partitioned into
16 sections within the range of [0, 1], and for each section, the remaining 4 noise ϵ values are randomly determined.
This iterative process is repeated 512 times, and the outcomes are averaged and then plotted.

considering the availability of approaches for estimating
quantum mutual information in existing works [46–48].
The pricing calculation for various derivatives depends
on the profits obtained from a specific portfolio and
is inherently linked to predicting its yield distribution.
The incorporation of k auxiliary qubits into the
InfoQGAN-trained model, along with a dedicated
circuit for controlling code qubits, facilitates the
generation of a superposition that encompasses 2k diverse
portfolio combinations. This advancement enables the
identification of the maximum value by utilizing an
evaluation observable related to the portfolio’s return
distribution, alongside Grover’s search algorithm
√ [49–51],
which operates with a time complexity of O( 2k ). This
development holds the potential for quantum advantages
not only in portfolio evaluation but also in broader
applications.
Our research not only contributes to the advancement
of theoretical aspects related to quantum machine
learning but also holds significant meaning in its
innovative approach to addressing financial problem-
solving through quantum methodologies. Beyond
addressing the portfolio optimization problem discussed
in this paper, we are enthusiastic about the application of
quantum algorithms and quantum machine learning in a
diverse array of financial problem-solving investigations.
Moreover, this approach lends itself to versatile
portfolio generation and evaluation through quantum
superposition, proving useful in various scenarios,
including portfolio design, yield prediction for ELS
(Equity-Linked Securities), option pricing, and more.
This underscores the potential of harnessing quantum
advancements in financial problem-solving. This facet
of our study holds immense potential and is expected to
create a profound impact across the broader spectrum of
quantum applications in the field of finance.
Acknowledgments
This work was supported by the National
Research Foundation of Korea (NRF) through
grants funded by the Ministry of Science and ICT
(NRF-2022M3H3A1098237) and the Ministry of
Education (NRF-2021R1I1A1A01042199). This work
was partially supported by an Institute for Information
& Communications Technology Promotion (IITP)
grant funded by the Korean government (MSIP) (No.

2019-0-00003; Research and Development of Core
Technologies for Programming, Running, Implementing,
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