Options Monte Carlo Simulation

One backtest is one sample of one history, and a strategy only had to be lucky once to look good inside it. Here the same structure runs over thousands of paths drawn from the real return distribution of the asset, so the historical result stops being the answer and becomes one point inside a distribution of answers.

• Thousands of paths generated from the empirical return distribution, not from a normal curve
• A distribution of outcomes, with the single historical backtest placed inside it
• Probability of loss and tail severity quantified, so the bad case carries a number