We present a unified theory of the variational Monte Carlo (VMC) and determinant quantum Monte Carlo (DQMC) methods using a novel density matrix formulation of VMC. We introduce an efficient algorithm for VMC to compute correlation functions and expectation values based on the auxiliary field Hirsch-Hubbard-Stratonovic transformation. We show that this new approach to VMC converges significantly faster than its traditional implementations. Furthermore, we generalize the Trotter-Suzuki decomposition to finite imaginary time steps
τ∼O(1) and develop a variational quantum Monte Carlo (VQMC) method accordingly, which is more accurate than VMC and can incorporate quantum fluctuations more efficiently. The two extreme limits of the VQMC method, namely infinitesimal and infinite imaginary time steps, correspond to the DQMC and VMC techniques, respectively. We demonstrate that our VQMC allows us to access lower temperatures in comparison with the conventional DQMC before the sign problem comes into play. We finally show that our VQMC can also enhance the accuracy of the projector Monte Carlo methods by providing better and less biased candidates for the trial wave functions, requiring shorter projection times for a given accuracy and alleviating the sign problem further.