AIM 04 MONTE CARLO SIMULATION

Monte Carlo simulation is single most powerful tool in financial decision-making. This section explains the Monte Carlo simulation technique and applies it to address four different finance problems.

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• Required reading

  • Tsekovva 20220227, Wall Street's risky 'razor blade' trade is making a comeback - Bloomberg.

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• Lecture notes

  • ​Slides

  • Support files: 

    • ​MC NPV.xlsx

    • MC Option valuation.xlsx

    • ​MC Spread option valuation.xlsx

    • MC Levered and inverse fund life.xlsx

      • SQQQ fact sheet.pdf​