This online course aims to develop skills in the translation of uncertainties in input data (costs, volumes, prices etc) into the domain of financial decision metrics such as NPV.
The course essentially entails the principles of probabilistic valuation. Whilst due attention is paid to concepts such as probability distributions, decision trees and Monte Carlo simulation, this course is unique in that it discusses the DeltaLogN Method. This is an easy to apply analytical method that allows quick translation from uncertainty ranges in the inputs of a financial model to the key decision metrics (NPV, IRR, etc.).
The course offers many example spreadsheets that can be retained.
Project economists, decision analysts, financial analysts, project development staff.
10-15 hours including all assignments.
The participant gets 90 days access to course and Q&A by the internal messaging system.
There are two options to take this course:
- Individually, no video or telephone engagement (questions and feedback by email only). Fee per participant is € 485 (excl VAT).
- In small groups with three video conferences on special topics and Q&A. Fee per participant is € 700 (excl VAT).
Another option is to add implementation coaching and other guidance (by video or face to face).
List of topics
There are 10 modules consisting of an introductory video, an interactive lesson with spreadsheet examples and an end of lesson quiz.
- Why bother – introduction, concept of expectation value, rationale of probabilistic analysis
- Statistical concepts – basics of probability distributions
- Range and probability assessment – by historic data analysis and judgemental methods
- Tornado diagram – a visual to show the key risks and uncertainties
- Decision trees – for structuring decision problems and communication
- Monte Carlo simulation demystified – using spreadsheets￼￼ only
- Analytical methods – introduction to probabilistics on a mathematical basis including the novel DeltaLogN method
- Tornado based probabilistics – three ways to generate an NPV distribution from a tornado
- Decision tree based probabilistics – combining a decision tree with tornados
- Implementation and communication – key take aways for communicating uncertainty with decision makers
For information just message us through the contact form.
Feedback from participants
“..very to the point (no textbook bullshit), very approachable, even if you had no background experience, and I could quickly see the application for what I was learning in my daily work…”
“Enjoyed the content and level it was pitched at; the concepts were clear and the example spreadsheets highly useful.”
“I liked the fact that the course is very clear and concise, so that you are able to learn a wide range of material in a short amount of time.”
“I liked the informal tone in which the course is conducted, together with the close presence of teachers through teleconference.”
The Head of Economics of the company concerned states: “The Fundamentals of Investment Risk and Uncertainty Analysis course demystifies some of the key concepts used in Decision Analysis. The course has the right balance of content and tools that can be easily applied in various economic evaluations. As well as brushing up on probabilistic economics theory our team is now better prepared to apply these in our business.”￼