Leveraging interactive visualizations and LLM-driven explanations for transparent multi-objective portfolio management

Financial investments are increasingly encouraged to incorporate environmental, social, and governance (ESG) considerations. For instance, in the context of mutual fund investments, once an investor determines a specific risk preference (e.g., conservative, moderate, or aggressive), ESG-optimized portfolios can be recommended to facilitate investment in ESG-positive mutual funds, such as those associated with lower pollution levels and improved ecosystem health. However, promoting ESG integration presents challenges, particularly in ensuring transparency within investment recommendations, which is crucial for fostering investor confidence and adoption. To address this issue, this paper proposes an interactive visualization system that allows users to navigate multi-objective optimized portfolios, compare their strengths and weaknesses, and understand the impact of ESG considerations on portfolio composition. The system aims to enhance user understanding and support informed investment decision-making. The effectiveness of this platform is validated through a user study, wherein financial experts provided positive feedback regarding its ability to improve decision-making processes. Additionally, by leveraging large language models (LLMs), the system offers on-demand explanations of financial terminology through text highlighting and a chat-based interface, further enhancing transparency and user engagement.