Monte Carlo Simulation

The Monte Carlo Simulation Add-in gives the Vanguard System™ Monte Carlo simulation and sensitivity analysis capabilities.

Monte Carlo simulations help to manage business risk and simulate complex systems. They are best for modeling uncertainty and volatility. Using Monte Carlo simulation allows you to replace point estimates with fuzzy values that reflect your uncertainty. This helps you characterize the range of potential outcomes in a business situation and assess the probability of reaching specific targets.

Like decision trees, Monte Carlo simulations result in an expected value that aids in choosing the most attractive course of action. They also provide information about the range of possible outcomes, probability of reaching specific targets, most likely outcomes, etc.

Because Vanguard supports artificial intelligence and advanced programming techniques, you can build Monte Carlo models that simulate complex systems such as production processes or even consumer behavior.

Features

• Distribution gallery
• Automatic distribution fitting using historical data
• User-defined distributions
• Correlated inputs
• Unlimited number of Stochastic inputs
• Output reports including distribution graphs and statistics
• Automatic sensitivity analysis
• 60 times the speed of spreadsheets
• Optional grid computing for speeds over 1,500 times that of spreadsheets

The distribution gallery makes it easy to assign uncertainty to any number of inputs.

The Fit Distribution tool will find the distribution that best fits your historical or experimental data.

Generate Probability Density and Cumulative Distribution graphs to illustrate uncertainty.

Use Time-based projection simulations to illustrate the effects of uncertainty over time.

Use standard correlation-based sensitivity analysis to see which inputs contribute most to overall uncertainty.

Vanguard's exclusive sensitivity analysis outperforms correlation analysis by showing you how uncertainty has different upside and downside impacts.