Some of the folks on “Quant Finance” linked-in group asked me to share the Monte-Carlo simulation model that I have developed.
Click here to download the excel model. (Note you might have to scroll down to see the download link)
Basically, in this excel model, I first start with min and max for uncertain parameters and simulate 5000 scenarios within the min/max range. I am trying to see how “profit” will vary under this scenarios. Later, I construct a histogram to see profit distribution and then do some statistical analysis of this distribution.
Note, the input uncertain parameters have random distribution in the excel model, but that might not be necessarily the case in real-world.