The correct approach to risk to ruin?

Generic
1

Is thre such a thing as the correct way to calculate a risk to ruin? Im wondering whats the standard way to calculate risk to ruin for a portfolio. Should I use Monte Carlo?

2

Hi,



There is no objectively "correct" method to calculate the risk to ruin for your portfolio, as different approaches can be used based on the information available. But the Monte Carlo simulation is a widely used method for calculating risk to ruin. Other methods, such as stress testing or deterministic models, can be tried, but you will have to research on how to apply them in your portfolio.



Thanks.