Case Study: FiduciaryVest achieves realistic, probability-driven asset-allocation forecasts with Palisade's @RISK

FiduciaryVest - Customer Case Study

FiduciaryVest, an investment consulting firm, faced the challenge of making multi-year allocation decisions across an expanding universe of asset classes (from 5–6 to as many as 20) and clearly communicating realistic outcomes to clients. To move beyond static efficient-frontier models that assume normal returns, FiduciaryVest adopted Palisade’s @RISK to incorporate longer time horizons and asset-specific probability distributions into its analysis.

Using Palisade’s @RISK, FiduciaryVest fitted different distributions (e.g., lognormal for bond returns), built a “building blocks” return model from risk-free rates plus historical risk premia, modeled fat tails and stress correlations (adding a second correlation table for crash scenarios), and ran multi-year (3–5 year) simulations. The result was more realistic, measurable risk estimates — including a finding that 3σ moves occur about 2% of rolling periods — and the ability to quantify probabilities of negative returns, meeting targets, and funding obligations; this improved client communication, demonstrated diversification benefits, and materially strengthened FiduciaryVest’s decision-making.

FiduciaryVest

Joe DiNunno

Asset Allocation Strategist