Does Monte Carlo tell me what will happen?

No. It gives a probability distribution under stated assumptions. Review the return, volatility, and cash-flow inputs carefully, since the output is only as reliable as those choices.

Monte Carlo

Monte Carlo Portfolio Simulation for Outcome Ranges

Stress-test plans with simulated return paths, percentile bands, and failure-rate context instead of relying on a single deterministic line.

Monte Carlo is for plan-risk questions: sequence risk, success ranges, and distribution-aware planning outcomes.

This page covers what the simulation models, what inputs matter most, and how to interpret the percentile output.

Open retirement example Read Monte Carlo Docs

Start with one question

See the workflow before opening the tool

Outcome range check

How wide is the plan outcome range under these returns and cash flows?

Output previewPercentile bands | failure-rate context | cash-flow assumptions

Open retirement example →

Historical sanity check

Does the simulated plan agree with a historical backtest of the same idea?

Output previewMonte Carlo range | historical replay | saved scenario notes

Open Portfolio Backtest →

What this workflow adds

Percentile ranges instead of a single deterministic outcome.
Stress testing for contribution and withdrawal plans.
Context for sequence-of-returns risk.

When not to use it

Monte Carlo is not a substitute for explicit historical backtests when the question is about how a specific strategy behaved. Use it when you need distributions, not when you need exact historical path replay.

Inputs that matter most

Return and volatility assumptions.
Cash-flow schedule and horizon length.
How many paths are enough for the decision you are making.

Best companion reads

Portfolio Backtest for historical context.
Verification Suite for engine coverage.
Pricing if you need larger simulation capacity.

FAQ

Does Monte Carlo tell me what will happen?: No. It gives a probability distribution under stated assumptions. Review the return, volatility, and cash-flow inputs carefully, since the output is only as reliable as those choices.

Portfolio Backtest

Historical replay of an explicit configuration.

Monte Carlo Docs

Detailed workflow and interpretation guide.

Tax-Aware Monte Carlo

Monte Carlo paths with saved tax context applied.

Pricing

Capacity differences for heavier simulation use.