Monte Carlo simulation for liquidity forecasts
Forecasting the liquidity of a company is an important task for financial analysts, investors, and management. It helps to understand the financial health of the company and its ability to meet its financial obligations in the short and long term. The step-by-step approach One way to forecast liquidity is through the use of Monte Carlo simulations. In this article, we will describe a step-by-step approach for using Monte Carlo simulations for this purpose and discuss the pros and cons of this method. Step 1: Gather data on the company’s financials and assumptions about future performance To begin, you will need […]