Frustrated by the straight jacket that the traditional NPV evaluation of an investment opportunity?  Confused, or exasperated by attempts to "improve" the analysis?   So was I.  

You will find below some articles describing my response.  The first introduces Monte Carlo analyse in Excel.  Master this technique and the power this can release is enormous: limited by your imagine!  The outcome when combined with the traditional NPV format is a model that is dynamic and more closely mirrors the real world.  The power lies in the thought process it FORCES the users of the model to go through:  what factors really influence the vale of this opportunity?  How might these change and interact?  What happens if I do this differently?

The second article introduces a lesser known technique for explaining risk to those of us not well educated in advanced statistics.  A simple way of presenting risk with an emphasis on the probability of it going wrong and what might be lost if it does.  Good investors know that cutting your losses and staying in the game is the key to long term success: the winners will look after themselves.  


Monte carlo or bust (pdf)


Presenting risk (pdf)