For More Information

If you're interested in theory, you can see the separate MPT article that explains how diversification improves your return/volatility tradeoff; the links page in that article lists books and sites that would be appropriate.


Also see the Recommended Books page.
Here are two articles outlining why Monte Carlo is the way to go for retirement planning: William F. Sharpe's Financial Planning in Fantasyland, and William J. Bernstein's The Retirement Calculator from Hell.


Other Monte Carlo calculators are available, and tend to fall into three categories: (1) standalone calculators (like ours) that require you to input expected returns and standard deviations; (2) sales oriented calculators, that let you create a portfolio from a particular provider's mutual funds; and (3) fees-based calculators, that can help you create a portfolio from many different sources. Here are some representatives:

MCRetire from Efficient Solutions
(standalone - this is a product that you purchase and download)

T. Rowe Price's Retirement Income Calculator
(sales oriented)

Financial Engines
(fees-based, elaborate)

(fees-based, uses historical data)

Money Tree's Retirement Capital / Monte Carlo calculator
(fees-based: this is a demo for a product meant to be used by financial planners to help their clients)


Article Contents
Standard Deviation
Lowered Expectations
Monte Carlo Calculator
Books & Links


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