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title: "The minimum number of iterations one can run in a Monte Carlo simulation"
canonical: "https://modelassist.epixanalytics.com/space/EA/26575298/The%20minimum%20number%20of%20iterations%20one%20can%20run%20in%20a%20Monte%20Carlo%20simulation"
format: markdown
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A short answer, burdened with many caveats, is "no less than 300'. At 300 iterations you start to get a reasonably well defined cumulative distribution, so you can approximately read off the 50th and 85th percentiles, for example, and the mean is pretty well determined for most output distributions. At the same time, if you export the generated values from two or more random variables in your model to produce scatter plots, 300 is really the minimum you need to get some sense of the patterns that they produce (i.e. their joint distribution). We usually have our models set to run 3000 iterations as a default (but obviously increase that figure if a particularly high level of accuracy is warranted), because we plot a great deal of scatter plots from Crystal Ball generated data, and this is about the right number of points before the scatter plot gets clogged up, and certainly enough for all the percentiles and statistics to be well-specified.

 

The figures below show what type of variation you'd typically get for a cumulative distribution between runs of 300 iterations, and of 3000, iterations. Since most models include an element of guess work in the choice of model, distributions or parameter values to use, one should not usually be too concerned about exact precision in the Monte Carlo results, but you'll see that 300 iterations is probably the least level of accuracy you might find acceptable.

 

> Macro (inline-media-image)

> Macro (inline-media-image)



Now these figures below show the same input and output plotted together as a scatter plot for 300 and 3000 iterations. We find scatter plots to be a great, intuitive presentation of how, among others, the input variability influences the output value. You'll see that the pattern is just about visible for 300 iterations, and just starting to get clogged up at 3000 iterations (of course, if you run more than 3000 iterations, you can plot a sample of just 3000 of them to keep the scatter plot clear). If the pattern were simpler, the left panel of 300 iterations would of course be clearer.

 

> Macro (inline-media-image)

> Macro (inline-media-image)



 

 

 

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