The Applying Monte Carlo Simulation in Excel to Analyze Investment Risk

About the Course:

This workshop introduces participants to the principles and applications of Monte Carlo simulation in Excel. You will discover who uses simulations, such as analysts in finance, operations, and risk management, and why they rely on them to evaluate uncertainty and predict outcomes. We begin with the fundamentals of random number generation and move into hands-on exercises, including rolling dice on a spreadsheet to demonstrate how simulations work.

Once the foundations are clear, you’ll apply Monte Carlo methods to practical projects, such as simulating a four-year budget 200 times (equivalent to 800 years of performance). Additional examples will illustrate how simulations support investment decisions, risk analysis, and long-term planning. This workshop makes a complex topic accessible, engaging, and directly applicable to real-world decision-making.

This hands-on workshop covers random number generation, different probability distributions, and practical applications for budgeting, investments, and decision-making under uncertainty.

Course Objectives:

• Generate random numbers in Excel.
• Use random number functions for various probability distributions (Uniform, Normal, Discrete, etc.).
• Build and run Monte Carlo simulations to analyze uncertainty and risk.
• Apply simulation techniques to budgeting, investments, and other practical scenarios.

Who is the Target Audience?

• Excel users interested in learning risk-analysis and simulation techniques.
• Professionals who want to model uncertainty in investments, operations, or planning.
• Participants with basic statistics familiarity and intermediate Excel skills.
• Learners without a strong statistical background, this workshop has been successfully taught to Executive MBA students with no prior statistics training.

Basic Knowledge:

• Intermediate Excel skills (formulas, functions, and navigating worksheets).
• A basic, informal understanding of statistics (concepts like averages, variability, or probability).
• No advanced statistics background is required; the workshop is designed to make simulations accessible to all Excel users.