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Quantum optimisation algorithms and their applications

Haomu Yuan

Published Jan 22, 2026• 0 citations
Publisher

Abstract

This thesis is devoted to four modern quantum optimisation algorithms and their applications. In the first chapter, we provide a complete Quantum Approximate Optimisation Algorithm (QAOA) pipeline for the discrete global minimum-variance portfolio (DGMVP) problem. We introduce an ansatz with efficient initial-state preparation, new hard mixing operators satisfying the constraints of the DGMVP problem, and scalable cost operators utilising binary encoding of the qubits. Benchmarking the method with the most effective optimisation strategies---dual annealing and unfrozen layerwise optimisation---indicates a scaling advantage over classical methods in finding the global optimum of the DGMVP problem. In the second chapter, we show an end-to-end quantum/quantum-inspired Goemans-Williamson semidefinite programming (SDP) method for relaxing Quadratic Unconstrained Binary Optimisation (QUBO) problems and extracting their rounding energy. Our method identifies a class of QUBO instances that is effectively solvable in polylogarithmic time relative to the problem dimension, under the assumptions of Pauli sparsification of the QUBO cost matrix, reducibility of the diagonal constraints, and efficient evaluation of the corresponding Gibbs-state expectation values. Further, we identify the commuting 1D Hamiltonian and the Kronecker graph as practically important instances. Our numerical experiments show that our method solves the SDP and QUBO with up to $2^{50}$ variables for 1D Hamiltonian instances and achieves results competitive with the best classical solver for Kronecker graphs, giving strong evidence of the power of our algorithm. In the third chapter, we improve the current QAOA method with an iterative warm-start initial-state preparation method. We implement the $t$-th order statistic state as the warm-start initial state generated from each QAOA optimisation loop. We achieve an improved approximation ratio when solving the 3-regular MaxCut problem, and find that the worst-case approximation ratio converges to that of the best classical algorithm for $p=1$ QAOA. Additionally, our method achieves more favourable scaling than standalone QAOA, single-string warm-started QAOA, and a classical constrained-sampling approach when solving the DGMVP problem. In the fourth chapter, we provide a hard-constrained Grover adaptive search (GAS) method for fixed-sum quadratic binary optimisation problems, and an extension of the alternating direction method of multipliers (ADMM) framework for fixed-sum quartic binary optimisation. Our method guarantees at least a quadratic speed-up over the classical method, and exponentially reduces the gate count for solving fixed-sum binary optimisation when compared with the soft-constrained GAS in the fault-tolerant quantum computing regime. In summary, our contributions include efficient algorithms and novel frameworks that substantially improve performance and broaden the applicability of these quantum optimisation methods. The proposed methods exhibit favourable scaling behaviour and indicate potential quantum advantages in solving challenging optimisation problems, thereby motivating further research at the interface of quantum computing and optimisation.

DOI
10.17863/cam.135476

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This thesis is devoted to four modern quantum optimisation algorithms and their applications. In the first chapter, we provide a complete Quantum Approximate Optimisation Algorithm (QAOA) pipeline for the discrete global minimum-variance portfolio (DGMVP) problem. We introduce an ansatz with efficient initial-state preparation, new hard mixing operators satisfying the constraints of the DGMVP problem, and scalable cost operators utilising binary encoding of the qubits. Benchmarking the method with the most effective optimisation strategies---dual annealing and unfrozen layerwise optimisation---indicates a scaling advantage over classical methods in finding the global optimum of the DGMVP problem. In the second chapter, we show an end-to-end quantum/quantum-inspired Goemans-Williamson semidefinite programming (SDP) method for relaxing Quadratic Unconstrained Binary Optimisation (QUBO) problems and extracting their rounding energy. Our method identifies a class of QUBO instances that is effectively solvable in polylogarithmic time relative to the problem dimension, under the assumptions of Pauli sparsification of the QUBO cost matrix, reducibility of the diagonal constraints, and efficient evaluation of the corresponding Gibbs-state expectation values. Further, we identify the commuting 1D Hamiltonian and the Kronecker graph as practically important instances. Our numerical experiments show that our method solves the SDP and QUBO with up to 2502^{50}250 variables for 1D Hamiltonian instances and achieves results competitive with the best classical solver for Kronecker graphs, giving strong evidence of the power of our algorithm. In the third chapter, we improve the current QAOA method with an iterative warm-start initial-state preparation method. We implement the ttt-th order statistic state as the warm-start initial state generated from each QAOA optimisation loop. We achieve an improved approximation ratio when solving the 3-regular MaxCut problem, and find that the worst-case approximation ratio converges to that of the best classical algorithm for p=1p=1p=1 QAOA. Additionally, our method achieves more favourable scaling than standalone QAOA, single-string warm-started QAOA, and a classical constrained-sampling approach when solving the DGMVP problem. In the fourth chapter, we provide a hard-constrained Grover adaptive search (GAS) method for fixed-sum quadratic binary optimisation problems, and an extension of the alternating direction method of multipliers (ADMM) framework for fixed-sum quartic binary optimisation. Our method guarantees at least a quadratic speed-up over the classical method, and exponentially reduces the gate count for solving fixed-sum binary optimisation when compared with the soft-constrained GAS in the fault-tolerant quantum computing regime. In summary, our contributions include efficient algorithms and novel frameworks that substantially improve performance and broaden the applicability of these quantum optimisation methods. The proposed methods exhibit favourable scaling behaviour and indicate potential quantum advantages in solving challenging optimisation problems, thereby motivating further research at the interface of quantum computing and optimisation.
We provide a method to prepare a warm-started quantum state from measurements with an iterative framework to enhance the quantum approximate optimisation algorithm (QAOA). The numerical simulations show the method can effectively address the "stuck issue" of the standard QAOA using a single-string warm-started initial state described in [Cain et al., 2023]. When applied to the 333-regular MaxCut problem, our approach achieves an improved approximation ratio, with a lower bound that iteratively converges toward the best classical algorithms for p=1p=1p=1 standard QAOA. Additionally, in the context of the discrete global minimal variance portfolio (DGMVP) model, simulations reveal a more favourable scaling of identifying the global minimal compared to the QAOA standalone, the single-string warm-started QAOA and a classical constrained sampling approach.
Abstract We present a quantum algorithm for portfolio optimisation. Specifically, We present an end-to-end quantum approximate optimisation algorithm to solve the discrete global minimum variance portfolio model. This model finds a portfolio of risky assets with the lowest possible risk contingent on the number of traded assets being discrete. We provide a complete pipeline for this model and analyse its viability for noisy intermediate-scale quantum computers. We design initial states, a cost operator, and ansätze within a binary encoding. Further, we perform numerical simulations to analyse several optimisation routines, including layerwise optimisation, utilising constrained optimisation by linear approximation and dual annealing. Finally, we consider the impacts of thermal relaxation and stochastic measurement noise. We find dual annealing with a layerwise optimisation routine provides the most robust performance. We observe that realistic thermal relaxation noise levels preclude quantum advantage. However, stochastic measurement noise will dominate when hardware sufficiently improves. Within this regime, we numerically demonstrate a favourable scaling in the number of shots required to obtain the global minimum—an indication of quantum advantage in portfolio optimisation.
There is an increasing interest in quantum algorithms for problems of integer programming and combinatorial optimization. Classical solvers for such problems employ relaxations, which replace binary variables with continuous ones, for instance in the form of higher-dimensional matrix-valued problems (semidefinite programming). Under the Unique Games Conjecture, these relaxations often provide the best performance ratios available classically in polynomial time. Here, we discuss how to warm-start quantum optimization with an initial state corresponding to the solution of a relaxation of a combinatorial optimization problem and how to analyze properties of the associated quantum algorithms. In particular, this allows the quantum algorithm to inherit the performance guarantees of the classical algorithm. We illustrate this in the context of portfolio optimization, where our results indicate that warm-starting the Quantum Approximate Optimization Algorithm (QAOA) is particularly beneficial at low depth. Likewise, Recursive QAOA for MAXCUT problems shows a systematic increase in the size of the obtained cut for fully connected graphs with random weights, when Goemans-Williamson randomized rounding is utilized in a warm start. It is straightforward to apply the same ideas to other randomized-rounding schemes and optimization problems.
The Quantum Approximate Optimisation Algorithm (QAOA) has emerged as a leading candidate for near-term quantum advantage in combinatorial optimisation, but most evaluations remain confined to synthetic benchmarks such as random MaxCut instances. Translating QAOA to real-world problem instances -- with irregular graph structures, heterogeneous constraint types, and practical scale requirements -- introduces additional challenges including QUBO formulation overhead, hardware embedding costs, and the performance gap between QAOA on structured real instances vs. random benchmarks. This paper presents the Real-World QAOA (RW-QAOA) framework, a systematic methodology for applying QAOA to four real-world application domains: supply chain network optimisation, financial portfolio rebalancing, telecommunications frequency assignment, and traffic signal timing optimisation. RW-QAOA introduces three methodological contributions: a domain-adaptive QUBO formulator (DAQF) encoding real-world constraints as penalised QUBO terms with penalty coefficient auto-tuning; a warm-start initialisation strategy (WSIS) using classical heuristic solutions to seed QAOA parameter search; and a layered noise adaptation protocol (LNAP) adjusting circuit depth based on real-time device calibration data. RW-QAOA is evaluated on real problem instances from industry partners across all four domains on IBM Quantum Eagle (127-qubit). RW-QAOA achieves solution quality within 4.2% of classical exact solvers across all four domains, outperforming classical greedy heuristics by 12.4% (SD = 3.8%) on average. WSIS reduces QAOA parameter convergence iterations by 48.4%. LNAP improves approximation ratio by 8.4pp vs. fixed-depth QAOA under device noise variation.
Combinatorial Optimization problems play an important role in various domains such as logis- tics, life science or the financial sector. As their complexity in general grows exponentially with their problem size, finding the optimal solution classically becomes infeasible very fast. This raises the central question of whether quantum computers are in principle suitable for solving combinatorial optimization problems better and faster than classical computers. In order to find answers to that question, one needs to study quantum algorithms designed for those problems under ideal conditions (i.e., simulations, which are however limited due to exponential scaling) to investigate their potential, but one also needs real quantum hardware to test its viability and evaluate whether practical advantages are reasonable. In this regard, we consider variational quantum algorithms, especially the Quantum Approximate Optimization Algorithm (QAOA) consisting of a problem and a mixer Hamiltonian with freely selectable parameters, originally proposed as variational hybrid ansatz with classical optimization. This algorithm structure of- fers flexible and relatively shallow circuits, which makes it suitable for current NISQ hardware. However, optimizing the variational circuit parameters can be an NP-hard problem at worst. In this thesis, we study different versions of QAOA, especially with a focus on limitations, perfor- mance and potential advantages opposite classical methods. The first part of the thesis concerns the investigation of various aspects regarding the imple- mentation of the variational QAOA protocol such as: the incorporation of a problem constraint either by adding a suitable penalty term of by choosing a suitable mixer (that restricts the search space), the scaling of the problem Hamiltonian in comparison to the mixer Hamiltonian, the choice of the initial values for the classical optimization of the circuit parameters, and finally the choice of the function to be minimized (i.e., CVaR vs. expectation value). We apply this proto- col to both the portfolio optimization and the feature selection and evaluate the performance. In order to improve QAOA, we consider the warm-start QAOA for different problem instances and analyze its improved performance with regard to involved quantum effects. For this purpose, we propose a classical pre-processing method and demonstrate that the warm-start results can be reproduced or even exceeded by this method. The second part addresses the issue that the standard variational form requires a high number of circuit parameters that have to be optimized at a sufficiently large depth, which is a major limitationforachievingpotentialscalingadvantagescomparedtoclassicalmethods. Toovercome this limitation, we investigate and further develop fixed schedules for QAOA, which only rely on two free parameters. We start with introducing the continuous adiabatic theorem as it motivates the form of QAOA and show its limitations, which we address by applying a discrete version of the theorem. With our findings, a new version of QAOA based on linear-ramps (LR-QAOA) is introduced and further developed. In order to derive suitable parameter values for this schedule, we propose a method based on extrapolation from smaller towards larger problem sizes. With our results obtained on a noiseless emulator, we evaluate the quantum runtime scaling and discuss whether a scaling advantage can be achieved compared to classical methods.
Recent advances in quantum computing and the increasing availability of quantum hardware have substantially enhanced the practical relevance of quantum approaches to discrete optimization. Among these, the Quadratic Unconstrained Binary Optimization (QUBO) formulation provides a unifying modeling framework for a broad class of NP\mathbf{NP}NP-hard problems and is naturally suited to quantum computing and quantum-inspired algorithms. Location science, network design, and logistics represent core application domains of discrete optimization, combining high practical impact with substantial computational challenges. In this work, we develop QUBO formulations for several fundamental problems in these domains, including a nonlinear integer formulation of the Discrete Ordered Median Problem (DOMP). Beyond their modeling relevance, these QUBO formulations serve as representative benchmark problems for assessing quantum algorithms and quantum hardware. We further derive a tight bound for the penalty parameter ensuring equivalence between the QUBO formulation and its underlying integer program. Finally, we conduct a comprehensive computational study using QAOA, WS-QAOA, and classical heuristics for QUBO instances of the ppp-Median Problem and the Fixed-Charge Facility Location Problem (FCFLP), and introduce two effective warm-start strategies for WS-QAOA based on its linear programming relaxation.