The Genetic Algorithm Is Applied Research In The Economic Evaluation Of Profits Of Listed Companies

Economic Value Added (EVA) has been considered as a well-recognized method of comparison which is used in financial assessment of enterprise value and performance evaluation. EVA is applied to evaluate the value of stock investment by the listed companies in China. As a comprehensive evaluation index, Economic Value Added of listed companies which indicates the overall operating condition of the listed companies is subject to a lot of factors, and these factors can usually be displayed by common financial indicators.What is the relationship in quantity between EVA and the financial indicators, and what is the degree these financial indicators impact the economic profit? These questions are difficult to answer. The main difficulty of study lies in how to set up model, and how to determine calculation methods and the difficulty of many decision variables to mass calculation. Data mining are the process of extracting implicit which people do not know in advance, but are potentially useful information and knowledge, from many incomplete, noisy, fuzzy and random data. Data mining technology is suitable in massive data analysis and calculation, and the genetic algorithm (GA) is a simulation of the bio-genetic and evolutionary birth to set up a searching and optimized algorithm, which simulates the biological mechanism "Natural selection, Survival of the fittest" by successive iteration of methods for searching the optimization. Genetic algorithm is much more effective than other methods in multiple decision-making variables to search the optimal solution.Therefore, the genetic algorithm, one of the data mining technology methods, is applied in the study of the evaluation of EVA in the listed companies, calculating in accordance with the characteristics of genetic algorithm, applying of the rules based on genetic algorithms integral prediction models, searching financial ratios for the best point of each the relative financial ratios should be scored, and then according to the size of financial ratios points to the company, then judging state of the economic profit based on a number of financial ratios to determine the cumulative scores of listed companies. After using the sample data in the calculation of financial indicators for the corresponding threshold and effects of degrees, we put the results of these calculations into the authentication data to verify Economic Value Added of the prediction accuracy.Through this method, the impact of the financial indicators for Economic Value Added is determined. The prediction in EVA can be made in quality or the goal decomposition of financial indicators can be made in accordance with the objectives of EVA (plus or minus) to determine all kinds of financial indicators of the target. All these have a strong practice-oriented sense. In addition, in the investment decision-making analysis, we can forecast its EVA status as the basis for investment decisions according to the financial indicators of investment objectives.