45 Probability Distributions with easy-to-use interface, running Super Speed Simulation (thousands of trials in a few seconds) with Comprehensive Statistics and Reporting, Distributional Correlations with Copulas, Latin Hypercube and Monte Carlo Simulation, Truncation, Percentile Alternate Parameters and Percentile Fit, Linking capabilities, Multidimensional Simulations, Simulation Profiling, 6 random number generators, and Risk Simulator functions in Excel
Bootstrapping, Check Model, Cluster Segmentation, Comprehensive Reports, Data Extraction and Statistics Report, Data Import, Deseasonalization and Detrending, Detailed Data Diagnostics, Distributional Fitting (Single, Multiple, Percentile Fit), Distributional Probabilities (PDF, CDF, ICDF), Hypothesis Testing, Overlay Charts, Principal Component Analysis, Sensitivity Analysis, Scenario Analysis, Statistical Analytics, Structural Breaks, Tornado and Spider Charts
Box-Jenkins ARIMA, Auto ARIMA, Basic Econometrics, Auto Econometrics, Combinatorial Fuzzy Logic, Cubic Spline, Custom Distributions, GARCH, J Curve, S Curve, Markov Chain, Maximum Likelihood, Multiple Regression, Neural Network, Nonlinear Extrapolation, Stochastic Processes, Time-Series Decomposition, Trendlines
Static, Dynamic and Stochastic Optimization with Continuous, Discrete and Integer Decision Variables, Efficient Frontier, Genetic Algorithm, Linear and Nonlinear Optimization, Single Variable Goal Seek
MAC OS users can run the software as long as they have Bootcamp, Virtual Machine, or Parallels
The following lists the new enhancements and tools available in the latest version of Risk Simulator, as well as enhancements from previous versions. Upgrades from versions 3.X, 4.X, 5.X, 6.X, or 2010.X require a small upgrade fee of only $300 (click on Purchase for more information).
ROV Decision Tree is used to create and value decision tree models. Additional advanced methodologies and analytics are also included: Decision Tree Models, Monte Carlo Risk Simulation, Sensitivity Analysis, Scenario Analysis, Bayesian (Joint and Posterior Probability Updating), Expected Value of Information, MINIMAX, MAXIMIN, Risk Profiles.
uses percentiles and optimization to find the best-fitting distribution.
runs 45 probability distributions, their four moments, CDF, ICDF, PDF, charts, and overlay multiple distributional charts, and generates probability distribution tables.
A new module called ROV BizStats, which is a standalone tool that can be used to run basic to advanced statistical analyses at very high speeds. This new module includes the following 130+ methods:
Absolute Values, ANOVA: Randomized Blocks Multiple Treatments, ANOVA: Single Factor Multiple Treatments, ANOVA: Two Way Analysis, ARIMA, Auto ARIMA, Autocorrelation and Partial Autocorrelation, Autoeconometrics (Detailed), Autoeconometrics (Quick), Average, Combinatorial Fuzzy Logic Forecasting, Control Chart: C, Control Chart: NP, Control Chart: P, Control Chart: R, Control Chart: U, Control Chart: X, Control Chart: XMR, Correlation, Correlation (Linear, Nonlinear), Count, Covariance, Cubic Spline, Custom Econometric Model, Data Descriptive Statistics, Deseasonalize, Difference, Distributional Fitting, Exponential J Curve, GARCH, Heteroskedasticity, Lag, Lead, Limited Dependent Variables (Logit), Limited Dependent Variables (Probit), Limited Dependent Variables (Tobit), Linear Interpolation, Linear Regression, LN, Log, Logistic S Curve, Markov Chain, Max, Median, Min, Mode, Neural Network, Nonlinear Regression, Nonparametric: Chi-Square Goodness of Fit, Nonparametric: Chi-Square Independence, Nonparametric: Chi-Square Population Variance, Nonparametric: Friedman’s Test, Nonparametric: Kruskal-Wallis Test, Nonparametric: Lilliefors Test, Nonparametric: Runs Test, Nonparametric: Wilcoxon Signed-Rank (One Var), Nonparametric: Wilcoxon Signed-Rank (Two Var), Parametric: One Variable (T) Mean, Parametric: One Variable (Z) Mean, Parametric: One Variable (Z) Proportion, Parametric: Two Variable (F) Variances, Parametric: Two Variable (T) Dependent Means, Parametric: Two Variable (T) Independent Equal Variance, Parametric: Two Variable (T) Independent Unequal Variance, Parametric: Two Variable (Z) Independent Means, Parametric: Two Variable (Z) Independent Proportions, Power, Principal Component Analysis, Rank Ascending, Rank Descending, Relative LN Returns, Relative Returns, Seasonality, Segmentation Clustering, Semi-Standard Deviation (Lower), Semi-Standard Deviation (Upper), Standard 2D Area, Standard 2D Bar, Standard 2D Line, Standard 2D Point, Standard 2D Scatter, Standard 3D Area, Standard 3D Bar, Standard 3D Line, Standard 3D Point, Standard 3D Scatter, Standard Deviation (Population), Standard Deviation (Sample), Stepwise Regression (Backward), Stepwise Regression (Correlation), Stepwise Regression (Forward), Stepwise Regression (Forward-Backward), Stochastic Processes (Exponential Brownian Motion), Stochastic Processes (Geometric Brownian Motion), Stochastic Processes (Jump Diffusion), Stochastic Processes (Mean Reversion with Jump Diffusion), Stochastic Processes (Mean Reversion), Structural Break, Sum, Time-Series Analysis (Auto), Time-Series Analysis (Double Exponential Smoothing), Time-Series Analysis (Double Moving Average), Time-Series Analysis (Holt-Winter’s Additive), Time-Series Analysis (Holt-Winter’s Multiplicative), Time-Series Analysis (Seasonal Additive), Time-Series Analysis (Seasonal Multiplicative), Time-Series Analysis (Single Exponential Smoothing), Time-Series Analysis (Single Moving Average), Trend Line (Difference Detrended), Trend Line (Exponential Detrended), Trend Line (Exponential), Trend Line (Linear Detrended), Trend Line (Linear), Trend Line (Logarithmic Detrended), Trend Line (Logarithmic), Trend Line (Moving Average Detrended), Trend Line (Moving Average), Trend Line (Polynomial Detrended), Trend Line (Polynomial), Trend Line (Power Detrended), Trend Line (Power), Trend Line (Rate Detrended), Trend Line (Static Mean Detrended), Trend Line (Static Median Detrended), Variance (Population), Variance (Sample), Volatility: EGARCH, Volatility: EGARCH-T, Volatility: GARCH, Volatility: GARCH-M, Volatility: GJR GARCH, Volatility: GJR TGARCH, Volatility: Log Returns Approach, Volatility: TGARCH, Volatility: TGARCH-M, Yield Curve (Bliss), and Yield Curve (Nelson-Siegel).
Risk Simulator 2012 now supports 11 languages: English, French, German, Italian, Japanese, Korean, Portuguese, Simplified Chinese, Traditional Chinese, Spanish and Russian, complete with the localized languages’ user interface, user manuals, reports, examples, exercises, tools, charts, and more!
You can now toggle between global view and regular view on the forecast charts where all of the controls from the regular tabbed view are now available in a single comprehensive global view.
You can now copy and paste multiple cells with noncontiguous assumptions and forecasts.
The ultra powerful Distributional Analysis tool now has a facelift where you can run PDF, CDF, ICDF and combinations of these on a data grid, copy the computed data, and view different chart types.
The Edit Correlation between input assumptions tool now supports an interactive visual correlation chart.
This new version supports Windows 7, 8, 10 – 32 and 64 bit versions, and Excel 2013, 2016 – 32 bit and 64 bit versions.
This version comes with 140 pages of step-by-step hands-on exercises for running each of the techniques and tools in Risk Simulator and 103 pages of probability distribution details (describing the characteristics and nature of the 45 distributions available in Risk Simulator), complementing the 206-page detailed user manual (translated into 11 languages).
The Troubleshooter tool is now integrated in the Start menu for Risk Simulator, where you can use this tool to obtain the status of Risk Simulator install (e.g., registry settings, COM settings, installation path), restore Risk Simulator if it is disabled, fix Excel security settings, obtain Hardware ID, and more.
This new version includes quicker report generation, scatter plot support in the Overlay Charts tool, simplified drop-list for seasonality selection in the Time Series Forecasting tool, more elegant looking Spider Charts, auto installation of licenses (if you upgrade from the same major version such as from 2012(A) to 2012(B), where the previous license will now be automatically transferred to the new version; this does not apply if you are upgrading from a different major version such as from version 5.X to 2010.X), and many other small enhancements and fixes.
General Enhancements in Risk Simulator Version 5.4 and beyond:
This new capability allows you to run simulations at super speeds (50X to 500X faster depending on the model and your processor speed!) by first analyzing your Excel model and then compiling the model into pure mathematical code and running the simulations at very high speeds. Certain models that cannot be compiled will be run at regular speed (e.g., models with VBA functions and macros, links to external data or files, unsupported or wrong functions, and errors in the model).
We added a new high-speed engine in our forecast methods and analytical tools. Same analyses results as in previous versions but they now run 10X to 30X faster depending on the analysis and your processor speed!
Users with both Excel 2007 and Excel 2003/XP loaded can now easily and seamlessly run Risk Simulator on any Excel versions in a single computer. There is now an Excel version switching tool that allows you to determine which version of Excel to start Risk Simulator with.
You can turn cell comments on or off in Risk Simulator’s Options menu, to decide if you wish to show cell comments on all input assumptions, output forecasts and decision variables.
You can now access all of Risk Simulator’s tools and menus using a mouse right click.
You can now enter in a single equation or multiple equations to run basic econometrics modeling and automatically create tens to hundreds of iterations of the same model through predefined variables as well as shift the data over time.
Simply click on the Advanced button when you run Optimization and select super speed simulation.
Users with Excel 2010/2007 will see a completely reworked icon toolbar that is more intuitive and user friendly. There will be four sets of icons that fit most screen resolutions (1280 x 760 and above).
The forecast charts now have additional graphical enhancements.
If you perform some data filtering in the forecast chart (Data Filter section in the Options tab), the Statistics tab will show the updated statistics based on the truncated data set. If you do not truncate the forecast data, the full dataset’s statistics will be shown as usual.
This is a new tab within the forecast chart whereby you can modify the existing forecast charts including performing distributional fitting on the forecast data set, creating overlay PDF/CDF/ICDF charts, overlaying scatter charts, and changing chart options (chart types, 3D rotation, colors, zoom, tilt, number of decimals, minimum and maximum values to chart on the axes, title name, and many other options, including the ability to save the revised settings and print the chart in various formats).
This new forecasting tool is used to run hundreds and even thousands of model combinations and permutations using smart heuristics to determine the best-fitting model for your data, by testing linear, nonlinear, lagged, lead, interacting, nested, and other models. This tool is the counterpart to the ROV Risk Modeler software’s detailed autoeconometrics, which is capable of running hundreds of thousands to a few million models on large datasets.
The existing forecasting tool is now enhanced with new capabilities including the ability to create new variables and functions such as TIME (a linear time-series variable), DIFF (first differencing the time-series data set), RESIDUAL (data from the error term of a forecast equation you specify), RATE (first order ratio of time-series data), and FORECAST (data from the error term of a forecast equation you specify).
This new tool runs the most common trendlines including linear, nonlinear, exponential, power, moving average, and polynomial models. It returns a series of charts as well as the goodness-of-fit statistics for each model.
This new charting tool is used to compare multiple assumptions and/or forecast variables, by plotting them in a time-series or cross-sectional overlay manner. This allows you to quickly view the similarities and differences in the assumptions and forecasts in easy to read charts.
This tool is capable of segregating and clustering or grouping a large set of data into different natural statistical groups by applying some smart algorithms and heuristics.
This new tool can create reports of just the key forecast statistics (e.g., mean, median mode, standard deviation, variance, coefficient of variation, skew, kurtosis) as well as confidence levels and probabilities of the output forecast variables you select. The result is a comparison table listing the selected statistics across multiple forecasts.
There are several new enhancements to our licensing:
Vista users with the user access control turned on or limited users without administrative logins will still be able to enjoy the full functionalities of Risk Simulator by being able to install the software licenses without doing any additional work. To install a new license file you received, simply start Excel, click on Risk Simulator, License, Install License and browse to the license file you are provided to activate the software permanently or for a longer trial period).
Risk Simulator now has the capability of turning on or off certain functionalities to allow you to customize your risk analysis experience. For instance, if you are only interested in the forecasting tools in Risk Simulator, you may be able to obtain a special license that activates only the forecasting tools and leaves the other modules deactivated, thereby saving some costs on the software. The four modules that can be turned on or off are Simulation, Forecasting, Optimization and Analytical Tools. In addition, specific tools in each module can also be turned on or off. This customization is only available for site licenses of more than 10 computers.
Together with the new forecasting tools and techniques in version 2012, Risk Simulator now has the following forecasting methodologies:
ARIMA (Autoregressive Integrated Moving Average)
You can now access Risk Simulator functions within Excel by clicking on Insert Function anywhere in your spreadsheet and scrolling to the functions starting with RS. Here, you can set assumptions as well as obtain the forecast statistics of a forecast variable. For instance, you can run the RSAssumptionNormal function to set a normal distribution assumption to a cell, or RSForecastStatistic to obtain the statistics of a forecast cell. In the set assumption forecast, you can set the placeholder or temporary value that is seen before and after a simulation is run (Value), the name of the assumption (Variable Name), and the parameters of the distribution (e.g., Mean, Standard Deviation), as well as other items such as percentile values, correlations, as well as min and max boundaries. For the results, you can also use RSForecastStatistic(A1, “Percentile99.9”) to obtain the 99.90 percentile value of cell A1, where this cell has a forecast parameter set. The functions that can be used include: “PercentileXXX”, “CertaintyXXX”, “Mean”, “Median”, StandardDeviation”, “Variance”, “Skewness”, and “Kurtosis”.
You can now use the mouse right-click to access quick Risk Simulator items in Excel, such as set assumptions, set forecasts, and run simulation.
In stochastic optimization, additional statistics are now available, including Percentiles as well as Conditional Means, such as obtaining the mean as long as it is > A or < A, which are critical in computing conditional value at risk measures.
The mean absolute deviation value is now changed to CV in the forecast chart’s statistics, where CV is the standard deviation divided by the mean, sometimes used as a proxy for volatility, and useful as a relative measure of risk, in comparing different sized projects, as well as being used as a risk-to-return ratio.
This new tool is used to compute various scenarios in your model, by changing one or two input variables at a time, for a range of inputs, to determine the effects on the output.
Additional checklists and options are now available, as are a more stable and powerful Tornado analysis (whereby you can now run Tornado across multiple worksheets), global settings (change one setting such as testing 10% upside and downside, and you can control if individual precedents are changed or the entire set of precedents are changed), and highlighting or ignoring possible integer values (sometimes integer values are used as flags in a model and this option helps in identifying potential precedents you may wish to ignore in running the Tornado). Worksheet names are now included in the sensitivity tables for easy identification, and other enhancements are included.
This optimization tool is capable of running multiple sets of optimizations with changing constraints. You can access this tool through the Set Constraints dialog box in optimization. This technique can be run in concurrence with static, dynamic and stochastic optimization.
This tool is now available on the Start | Programs | Real Options Valuation | Risk Simulator menu. It allows you to re-enable the software if Windows or Excel temporarily disables the software (this can occur if there is a power outage when you are running a simulation, if you get a virus or Trojan horse on your computer, if you accidentally delete some critical files, and so forth).
The module now is equipped with a Multiphasic Optimization and a test for Local versus Global Optimum in the “Advanced” options button (available when you run an optimization). These two new features, when used together with the existing advanced features, allow the user to have better control over how the optimization is run, and increases the accuracy and dependency of the results.
Select the data you wish to analyze, including the headers, and start this tool (located at Risk Simulator | Tools | Statistical Analysis), and the following analyses will be available:
Select the data you wish to analyze, including the headers, and start this tool (located at Risk Simulator | Tools | Diagnostic Tool), and the following: analyses are available:
These tests are vital before starting any types of forecasting or data analysis procedures. Each test comes complete with an easy-to-understand detailed report so that it does not take a trained econometrician or statistician to understand and interpret the results.
This is available at (Risk Simulator | Forecasting | Maximum Likelihood) whereby maximum likelihood iterative and internal optimization procedures are used to model binary response variables (the dependent variable is binary, taking on the values of 0 or 1). This is a key discriminant analysis with multiple uses (e.g., determining if patients will develop cancer given some characteristics such as age, cigarettes smoked, blood pressure; or to determine if a credit line or person will default on a loan given the company’s assets, asset volatility, or the person’s age, education level, years at a job, etc).
We have multiple language support, with English (USA), Chinese (Simplified), Spanish, and Japanese, with forthcoming editions with additional languages. Users can switch between languages midway while working on their models by simply clicking on the Risk Simulator and Languages menu, and restarting Excel.
We have completely upgraded our source code to work seamlessly with Microsoft .NET Framework 2.0/3.0. This translates to higher speed and compatibility with newer computers.
a. Dynamic Sensitivity Charts are now capable of taking both cell names and cell addresses.
b. Dynamic and Stochastic Optimization routines now support:
Conditional Means and Semi-Standard Deviations for CVar computations
c. Updated examples to showcase the use of Efficient Frontier analysis and multiple models econometrics
d. Updated Japanese user manual
e. Updated language edits and corrections in Spanish reports and Spanish user interface
f. Online resources menu inside Risk Simulator for quick and easy access at your fingertips
How do you make critical business decisions? Do you consider the risks of your projects and decisions, or are you more focused on returns? Do you have a hard time trying to understand what risk is, let alone quantifying risk? Well, our Risk Simulator software will help you identify, quantify, and value risk in your projects and decisions.
RISK SIMULATOR is a powerful Excel add-in software used for applying simulation, forecasting, statistical analysis, and optimization in your existing Excel spreadsheet models. The software was developed specifically to be extremely easy to use. For instance, running a risk simulation is as simple as 1-2-3, set an input, set an output, and run. Performing forecasting can be as simple as two or three mouse clicks away and the software does everything for you automatically, complete with detailed reports, powerful charts and numerical results. It even comes in English, Spanish, Chinese and Japanese, with additional languages on their way.
If we have the technology to send spacecrafts half way across the solar system, why can’t we spend a little more time quantifying risk? Such technology already exists and Risk Simulator encapsulates these advanced methodologies into a simple and user-friendly tool. We have books, live training (Certification in Risk Management) seminars, training DVDs, consultants and free sample getting started videos in risk analysis and modeling available on our website.
Risk Simulator is also integrated with our other software including the Real Options Super Lattice Solver, Employee Stock Options Valuation Toolkit, Modeling Toolkit (over 800 Functions and 300 Models), ROV Modeler, ROV Optimizer, ROV Valuator, ROV Basel II Modeler, ROV Compiler, ROV Extractor and Evaluator, and ROV Dashboard. Please visit our website for more details.
Risk Simulator can be downloaded immediately from our website with a default 10 day trial license. Our philosophy is you get to try before you buy. Once you use it, we are convinced you will fall in love with the simplicity and the power of the tool, and it will become an indispensible part of your modeling toolbox. We also have academic licenses for full time professors teaching risk analysis (and their students) or other associated courses using Risk Simulator or our other software products. Contact firstname.lastname@example.org for details.
Advanced analytical tools such as the Risk Simulator software are built to be easy to use but may get the analyst in trouble if used inappropriately. Sufficient theoretical understanding coupled with pragmatic application experience is vital; therefore, training is critical.
Our Risk Analysis course is a two-day seminar focused on hands-on computer-based software training, with topics covering the basics of risk and uncertainty, using Monte Carlo simulation (pitfalls and due diligence), and all of the detailed methods in forecasting and optimization.
We also have a Real Options for Analysts course for the analysts who want to immediately begin applying strategic real options in their work, but lack the hands-on experience with real options analytics and modeling. This two-day course covers how to set up real options models, apply real options, and solve real options problems using simulation, closed-form mathematics, and binomial and multinomial lattices using the Real Options SLS software.
The Certified Quantitative Risk Management (CQRM) seminar is a four-day hands-on class that covers the materials on our Risk Analysis and Real Options for Analysts courses and geared towards the CQRM certification provided by the International Institute of Professional Education and Research (AACSB member and eligible for 30 PDU credits with the Project Management Institute, Inc (PMI)®).
Our Risk Analysis for Senior Managers is a one day course specially designed for senior executives, where we will review case studies in risk management from 3M, Airbus, Boeing, GE, and many others. It provides an executive overview of risk analysis, strategic real options, portfolio optimization, forecasting and risk concepts without the technical details.
Also available are other customized decision, valuation and risk analysis courses with an emphasis on on-site trainings customized to your firm’s exact needs based on your business cases and models). Consulting services are available, including the framing of risk analysis problems, simulation, forecasting, real options, risk analytics, model building, decision analysis, integrated OEM and software customization.
Dr. Johnathan Mun is the software’s creator and teaches the Risk Analysis, Real Options for Analysts, Risk Analysis for Managers, CRM, and other courses. He has consulted for many Fortune 500 firms (from 3M, Airbus, and Boeing to GE and Motorola) and the government (Department of Defense, State and Federal Agencies) on risk analysis, valuation, and real options, and has written a number of books on the topic, including Real Options Analysis: Tools and Techniques, 1st and 2nd Edition (Wiley Finance, 2002, 2005); Real Options Analysis Course: Business Cases (Wiley Finance, 2003); Applied Risk Analysis: Moving Beyond Uncertainty in Business (Wiley, 2003); Valuing Employee Stock Options Under 2004 FAS 123 (Wiley Finance, 2004); Modeling Risk: Applying Monte Carlo Simulation, Real Options Analysis, Forecasting and Optimization (Wiley, 2006); Advanced Analytical Models: 800 Functions and 300 Models from Basel II to Wall Street and Beyond (Wiley 2008); The Banker’s Handbook on Credit Risk: Implementing Basel II (Elsevier Academic Press 2008); and others. He is the founder and CEO of Real Options Valuation, Inc., and is responsible for the development of analytical software products, consulting, and training services. He was formerly Vice President of Analytics at Decisioneering, Inc. (Oracle), and was a Consulting Manager in KPMG’s Global Financial Strategies practice. Before KPMG, he was head of financial forecasting for Viking, Inc. (an FDX/FedEx Company). Dr. Mun is also a full professor at the U.S. Naval Postgraduate School, a professor at the University of Applied Sciences and Swiss School of Management (Zurich and Frankfurt), and has held other adjunct professorships at various universities. He has a Ph.D. in finance and economics, an MBA in business administration, an M.S. in the area of management science, and a BS in applied sciences. He is certified in Financial Risk Management (FRM), Certified in Financial Consulting (CFC), and Certified in Risk Management (CRM).
PMI is a registered mark of the Project Management Institute, Inc.