Risk Profiler


The Risk Profiler tool helps you build your own risk distribution profile using three different methods.

The first method, Describe Profile Features, is the easiest method of the three. It only requires data entry for the minimum, maximum, and most likely values associated with the distribution. It uses these three pieces of information to generate a PERT (Program Evaluation and Review Technique) distribution. The resulting risk profile is displayed graphically in three different ways: as a histogram, as a probability distribution function (PDF), and as a cumulative distribution function (CDF). The summary statistics are also displayed for each risk profile generated.

The second method, Describe Profile PDF, lets the decision maker build a risk profile by describing five outcome values and their corresponding probability of occurrence. Using these outcomes and probabilities, the Risk Profiler tool applies a symmetrical and even interval around each point estimate to generate histogram, PDF, and CDF graphics along with summary statistics for each distribution.

The third and final method, Build Profile w/ Data, builds a Risk Profile from ten outcome values entered by the user. This method works real well when the user has ten observations to draw from such as ten years worth of yield history or ten price observations.