Finance and Risk Analysis Skills - Crystal Ball Edition (16hrs Remote Online)
OVERVIEW
Forecasting, simulation, and optimization techniques are increasingly popular tools that provide Financial Analysts with analytic power well beyond the traditional toolset. Through workshops, case examples and practical Excel based learning models, participants will actively learn and practice essential skills and techniques to:
Obtain accurate estimates from subject matter experts,
Test & validate planning assumptions,
Leverage historical data in planning/estimating scenarios,
Assign a probability of realizing an objective,
Forecast market conditions probabilistically
Etc.
TARGET AUDIENCE
This workshop is designed for both the beginner and advanced financial analyst who want to learn how to simulate and stress test their forecasts and projections using Crystal Ball.
Banking, Credit & Insurance Professionals
Forecasting and Planning Professionals
WORKSHOP CONTENT
MODULE 1 - ENHANCING THE MODELING PROCESS WITH SIMULATION
Why is Risk Analysis SO important in today’s world?
Challenges in corporate finance
The flaw of averages
Understanding risk analysis key concepts and definitions
Workshop: What does 90% confidence really mean?
Modeling vs. Simulation
Overview and history of Monte-Carlo Simulation
Advantages and Disadvantages of simulation
How and Where simulation and risk analysis can have a positive impact on the organization
The Modeling Process
Understanding how the modeling process works in the business
Obtaining and using historical or published data
Discussion on using the Monte-Carlo Method for properly scoping the need, building assumptions and establishing model constraints with Subject Matter Experts
Workshop: Using risk analysis to develop a New Compensation Model
Using and Configuring Crystal Ball for Risk Analysis: Toolbar, Basic Terminology, Sampling (Latin HyperCube vs. Monte-Carlo), Reporting and Data Extraction
MODULE 2 – BUILDING AND RUNNING MODELS
Essential Statistics For Risk Modeling
Workshop: Understanding how probabilities work with the DICE model
Basic probability statistics (Mean, Standard Deviation, Kurtosis, Skewness)
Overview of principal distributions and when to use them
How to analyze existing models to apply risk analysis: Tornado Charts and One Way Sensitivity Analysis to identify inputs with the greatest impact
Working with Distributions and Model Inputs
Best practices for defining model inputs in Excel and Crystal Ball
Making sure your model behaves correctly using correlation
Workshop: Portfolio Allocation Model
Defining, Analyzing and Communicating results to the business
Setting up model outputs and visualizing results and charts (Sensitivity, Forecasts, Assumptions and Overlays)
Establishing Confidence Intervals and configuring precision control to optimize the number of trials
Generating Crystal Ball Reports
Techniques to effectively and simply communicate your analysis to your peers, clients and superiors
Question handling
Risk identification and Assessment using Simulation
Interpreting Forecasts and Sensitivity Analysis
Identifying Risks and Potential Mitigation Strategies
Model Calibration using Risk Management Mitigation Solutions
Workshop: ROI Analysis and business growth analysis using historical data to build ROI Scenarios and compare them using Overlay Charts (DuPont Model)
MODULE 3 – INCORPORATING HISTORICAL DATA AND TRENDS INTO YOUR MODEL
Correlation and Regression
What are correlations and their impact on results
Overview of regression and its basic applications, including LogReturns
Workshop: How to calculate rank correlation and use it to correlate model assumptions
Workshop: Correlation Matrices
Aggregate Assumptions
Data/Distribution Fitting
How to fit a distribution using historical data
Analyzing fit results and selecting the RIGHT distribution for both univariate and multivariate data.
Time-Series Forecasting
Overview of the components and applications of time-series forecasting
Time-series projections using Crystal Ball to easily incorporate Seasonality, Smoothing algorithms, Growth Projections using historical data
Workshop: Projecting Next Year’s Sales
MODULE 4 – OPTIMIZATION AND SCENARIO MODELING
Simulation Optimization
Introduction to Simulation - Optimization with Crystal Ball
Everyday Optimization applications and examples
How does Simulation Optimization Work
Portfolio Optimization Techniques : With the help of several integrated financial models, this workshop will provide financial analysts with a complete understanding of why, where and how to apply spreadsheet forecasting, simulation, real options and optimization within their analyses.
Project Portfolio Selection: Use OptQuest to pick the best projects based on Organizational Budget Constraints
Portfolio & Resource Allocation Optimization: Allocate resources or budgets among various investments to maximize NPV or ROI or minimize risk or expense.
Modeling Efficient Frontier Analysis to optimize risk against benefit for projects and investments. (Portfolio Allocation)
BENEFITS
At the end of this 2 day workshop, participants will be able to:
Understand and apply Monte-Carlo simulation and optimization in their day-to-day activities
Make better and more informed decisions through the understanding of the factors driving financial performance.
Quickly build effective models or customize existing ones with Crystal Ball
Apply simple and effective Crystal Ball Risk analysis techniques
Pick and manage project more effectively
Use historical data to forecast future revenues and how to use those forecasts to create better predictive Discounted Cash Flow (DCF) models
Perform a DCF analysis and determine ROI on a specific project using Monte Carlo simulation to identify and evaluate risk and uncertainty in your model