Scenario Analysis Tool

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  • October 8, 2014
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The scenario analysis tool in Risk Simulator allows you to run multiple scenarios quickly and effortlessly by changing one or two input parameters to determine the output of a variable. … Continue Reading →

Accuracy, Errors, Precision, and Confidence

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  • October 8, 2014
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Definitions of Accuracy, Errors, Precision, and Confidence Make sure that you do not confuse several related but very different terms: accuracy, error, precision, and confidence. Albeit people tend to use … Continue Reading →

Bootstrap Simulation

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  • October 8, 2014
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Theory Bootstrap simulation is a simple technique that estimates the reliability or accuracy of forecast statistics or other sample raw data. Bootstrap simulation can be used to answer a lot … Continue Reading →

Segmentation Clustering

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  • October 1, 2014
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Another analytical technique of interest is that of segmentation clustering. Figure 1 illustrates a sample dataset. You can select the data and run the tool through Risk Simulator | Tools … Continue Reading →

Correlations and Correlated Simulation with Copulas

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  • October 1, 2014
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The Basics of Correlations The correlation coefficient is a measure of the strength and direction of the relationship between two variables, and it can take on any value between –1.0 … Continue Reading →

Hypothesis Testing

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  • October 1, 2014
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Theory A hypothesis test is performed when testing the means and variances of two distributions to determine if they are statistically identical or statistically different from one another; that is, … Continue Reading →

Detecting and Fixing Some Common Forecasting Problems: Heteroskedasticity, Multicollinearity, and Autocorrelation

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  • September 24, 2014
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Detecting and Fixing Heteroskedasticity Several tests exist to check for the presence of heteroskedasticity. These tests also are applicable for testing misspecifications and nonlinearities. The simplest approach is to graphically … Continue Reading →

Structural Break Analysis

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  • September 24, 2014
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A structural break tests whether the coefficients in different datasets are equal, and this test is most commonly used in time-series analysis to test for the presence of a structural … Continue Reading →

ROV BizStats

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  • September 24, 2014
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The ROV BizStats tool is a very powerful and fast module in Risk Simulator that is used for running business statistics and analytical models on your data. It covers more … Continue Reading →

Optimization Procedures: Stochastic Optimization

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  • September 17, 2014
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Many algorithms exist to run optimization and many different procedures exist when optimization is coupled with Monte Carlo simulation. In Risk Simulator, there are three distinct optimization procedures and optimization … Continue Reading →