Reliability of multi-criteria decision making methods in stock selection: evidence from Istanbul Stock Exchange
Year: 2026
Type: article
Abstract: This study offers a practical framework for investors and financial decision-makers who must evaluate multiple criteria when selecting stocks. Traditional approaches often rely on subjective judgments, while this research applies two structured multi-criteria decision-making methods: the Preference Selection Index (PSI) and the Evaluation Based on Distance from Average Solution (EDAS). PSI provides a simple and objective way to rank stocks because it does not require assigning weights to criteria. EDAS helps practitioners identify stocks that perform better than the market average by measuring their distance from the mean. Both methods are easy to implement, transparent, and suitable for environments with many alternatives. The results show how these techniques can support more consistent, data-driven stock selection and examine whether the rankings are related to future returns. The framework can be used by individual investors, portfolio managers, and financial institutions seeking a systematic and replicable selection process.
Source: Applied Operations and Analytics
Author: Hakan Altın
Institution: Aksaray University
Language: English
Field: Decision Sciences
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W7204129616