The Problems Of Monte Carlo Simulation

Portfolio management is an important factor that determines the performance of the portfolio. To perform well in the portfolio, it is not only essential to develop personal investment strategies, but analyzing current financial trend is also vital. Stock Trak is an online portfolio simulation that allows students to try out different investment strategies, and also get a hand on experience in what the real market trading conditions are. By managing the portfolio, I have acquired some new knowledge of investment strategies and also become more familiar with the current market by following closely to the financial headlines.

This report will describe examine the various strategies that were undertaken to successfully complete the Stocktrak simulation. Firstly, an analysis of the US and Chinese markets will be given as they are crucial markets that play a big role in the worldwide economy. Due to the fact that the US economy has been going through a recession, a working knowledge of this economic was crucial to our success. Our initial strategy revolved around timing trades based on daily market performance and expectations using daily market news and reports. While this strategy was successful to an extent, our group soon focused on diversifying our portfolio, not just through the quantity of

These decisions may include selling and buying of stocks, bonds, futures, currencies and so on. Stocktrak.com helps to implement the investment decision process as it includes evaluation tools for securities being traded at stock market. The website provides graphical historical performance of stock prices and this graphical performance can be analyzed for making different investment decisions related to those stocks. This project will be investing the given specified amount in a portfolio. The portfolio investment will help to reduce the level of risk associated with investment. With the reduction in level of risk, the average return of portfolio investment will increase as compare to individual investments. Thus, portfolio investment is better option for investment as compare to individual

“The Benefits of diversification are clear. Portfolio theory has played a crucial role in explaining the relationship between risk and return where more than one investment is held. It also enables us to identify optimal and efficient portfolios.”

The decision making of management is very crucial and involves various analysis to be performed. There are various ratios and methods that can be useful for mitigating the risks and increasing the expected returns with investments. The financial forecast is a mix of the behaviour,

Recently, Tricia-Mart opened new branches to its existing ones. The management are keen on improving efficiency and services of the company. There are many ways in which this improvement can be done using simulation software: higher quality and efficiency from capital assets, better management of inventory, higher return on asset, this list is endless. But some of these improvements could be made without simulation, so the real question is ‘Why use simulation instead of another method such as real life experimentation?’

Since quarter one was the first quarter of this simulation, I was unaware of how difficult it was going to be to make all the different decisions. Firstly, I had to choose a Company name. Because I was selling computers, I thought that the name “Dev-Tech” was a perfect fit being that this simulation was about development and technology. Next, I had to choose a target segment. I knew going into this simulation that it would be better to invest in the more expensive goods as it would benefit me in the end. The segment that didn’t care about price was Mercedes, so that is the segment that I made my first priority.

We were four in our group and we were given a scenario of a patient who was having an anaphylactic reaction from bee sting venom. The group agreed that I will be the primary nurse. As the primary nurse, I knew that I had to lead and supervised our group in responding to the emergency situation at hand. Having played the role of a primary nurse in this simulation, I have gained meaningful experience, which I can use in my future nursing practice.

The strategy I chose for the simulation is “Niche Cost Leader." First, with the key focus being value, this strategy will challenge me to keep costs at a minimum and force me to streamline overall costs to produce a valuable commodity that, in turn, will generate financial success that can be shared with internal and external stakeholders. Second, as the success of this strategy primarily relies on the existing product line being prosperous, I will be able to practice and hone my forecasting skills based on one product. Though I eventually will produce more than one product, most of the simulation will be conducting under making the primary product as successful as it can be, and reliable forecasts are

Monday, September 10, 2012, I started Stock-Trak, an online portfolio game. Stock- Trak allowed me to gain hands on experience testing different investment strategies in a risk-free, yet realistic environment. From September 10 to November 16, 2012, I took part in one such simulation by managing an online Stock-Trak portfolio. I was given an initial amount of $100,000 pretend cash with which to invest. All monetary decisions were at my discretion. This paper discusses my trading experience , my portfolio’s performance, the strategies used during the simulation, what I learned in the process, and how I will implement the knowledge gained from the simulation in future investments.

The simulation is useful because it evaluates project performance using real criteria, such as the scope, schedule and

This PowerPoint presentation was prepared by Professor Timothy Luehrman for the sole purpose of aiding classroom instructors in the use of Finance Simulation: M&A in Wine

Over the past three weeks in the University of Phoenix Marketing Management class, I have completed three simulations based on real life marketing situations. The first simulation was titled, "Forecasting Market Demand." This simulation discussed the importance of determining the future demand for your product in the voice commanded software industry. The marketing team for the new Listensoft software needed to accurately forecast the production capacity of the new product and the pricing strategy. This task is especially difficult because human behavior is difficult to predict. Forecasting behavior "…is about generating numbers out of expectations, opinions, statements, prior patterns and a host of other subjective elements" (Forecasting

Simulation is a computer process that gives a probable NPV or IRR for a project. All factors that affect the project’s returns are input. The computer then randomly selects one observation from each category. All of the observations are combined and the NPV or IRR is calculated from those figures. Simulation gives a range of outcomes as well as the probability of the outcomes. It provides the total risk level of a project.

Simulations are problem-based units of learning that are set in motion by a particular task, issue, policy, crisis, or problem. The problems to be addressed by the participant may be either implicit or explicit, depending on the nature of the simulation.