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Monte Carlo Asset Income to Asset Percent

This is a question regarding the way the Monte Carlo results are applied to the asset portfolios. After running with Monte turned on, when you go to the Detail Report and the Husband Retirement Accounts tab (or the Wife's Retirement Accounts tab): take the subsequent year's retirement account asset income and divide it by the prior year's retirement account assets. The result is a percent. When you copy that formula down through the years, the percent is almost entirely a constant. (The same applies to the Main Report using the Regular Assets and Total Income tabs to get the corresponding data).

This constant earning percent is counter to what I would have expected for a Monte simulation. I thought the asset growth would have varied across the years (dependent on the random draws) and not be a constant. Why does the constant occur? What am I missing?

Thanks in advance for whatever clarification you can provide.

Joe

1

The detail report is the result of the basic module which assumes that you always get the mean (expected) rate of return. This is expected behavior. The MC report shows the actual variations.

Best,

Dick Munroe
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