Simulate Compound Growth With Volatility

Interested in how your investment could grow? Worried about how risky it can be to invest? This simulation tool uses Monte Carlo simulations to estimate the evolution of an investment. It takes into account the compound annual growth rate (CAGR) and the yearly volatility, and runs thousands of cases to show you the range of outcomes you might expect.

Monte Carlo simulations are a way to predict the outcome of a scenario that has a significant degree of uncertainty. By running thousands of simulations, each with random variations based on your inputted volatility, the tool can model a vast range of possible investment paths. However, to keep the graph clear and easy to interpret, only ten representative trajectories are displayed—each one corresponding to a different percentile of the final investment distribution. This approach gives you a snapshot of potential outcomes, from the lower end (what you might end up with in less favorable conditions) to the higher end (the outcome if things go exceptionally well).