monte carlo option model

A Monte Carlo option model is a way to figure out how much money you could make or lose with a certain investment. It works by taking a lot of possible outcomes and plugging them into a computer model. So, imagine a bunch of tiny specks of sand, each one representing one possible outcome of the investment. The computer uses this information to figure out the expected return or loss of that investment. So instead of having to check each possible outcome one by one, you can get the same information with just one calculation!