Monte Carlo analysis is a technique used by many financial planners and large investment companies to help their clients make plans for the future. Essentially a series of computer simulations, it uses historical investment performance data to determine the probability of the occurrence of some type of event. Typically, Monte Carlo analyses are run to determine one's ability to reach a specific financial goal. A common use is in retirement planning so that users can see if they have sufficient invested assets to last until a certain age.
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