21st Century Risk Modeling

The BIG Ideas

  • Connecting the Seat of the Intellect to the Seat of the Pants
    Interactive Simulation and Visualization - A new generation of simulation software runs thousands of scenarios before the user's finger has left the <Enter> key. Visualization software can reveal statistical insights to the non-statistician.

  • A New Risk Arithmetic
    The DIST™ Distribution String - This open standard encapsulates thousands of scenarios into the single cell of a spreadsheet or element of a data base, allowing risks and rewards to be easily added together. The benefits over conventional statistics are analogous to the benefits of Arabic over Roman Numerals.

  • The CPO
    Probability Management - Databases of probability distributions are produced by those with statistical expertise and consumed by risk managers with business expertise. In this division of labor, the ultimate supplier of probabilities is the Chief Probability Officer, or CPO. See www.ProbabilityManagement.org.
CPO cap

"The DIST is a significant advance in the representation of probability distributions."
Paul Kaplan,
Vice President of Quantitative Research at Morningstar Inc.

"At Oracle, we are actively working to support the new DIST standard in future software releases."
Eric Wainwright,
Oracle Corp's Crystal Ball Monte Carlo Simulation Package