Precision Control

For some models, the accuracy of the statistics is highly dependent on the values of the decision variables. In these cases, you can use Crystal Ball’s precision control feature to run a sufficient number of trials for each simulation to achieve the necessary level of accuracy.

You can use Crystal Ball’s precision control feature for several purposes:

Precision control periodically calculates the accuracy of the forecast mean, standard deviation, and any indicated percentile during the simulation. When the simulation reaches a desired accuracy, it stops, regardless of the number of trials already run.

This feature is especially useful for optimization models such as Portfolio Allocation, where the forecast statistics are highly sensitive to the decision variables. When OptQuest selects conservative investments, the variability of the expected return is low and the statistics are relatively stable. When OptQuest selects aggressive investments, the variability is high and the statistics are relatively less stable. Using precision control increases your forecast statistic accuracy while avoiding running too many trials when a simulation reaches this accuracy quickly.

Note that finding the appropriate precision control settings might require some trial and error. It can be challenging to decide whether to use absolute or relative precision, what is the best precision value in either case, and which statistics should receive precision control. For more information on setting the precision control feature, see the Oracle Crystal Ball User's Guide.

  To see the effects of using precision control with the Portfolio Allocation model:

  1. In Crystal Ball, select Run, Run Preferences and change the maximum number of trials from 1000 to 5000.

    This maximum limit is always in effect, even when precision control is turned on. Therefore, when using precision control, you must increase the maximum number of trials to let precision control achieve the appropriate accuracy.

  2. Turn on Precision Control.

    1. Select cell C17.

    2. Select Define, Define Forecast.

    3. Click the More button in the Define Forecast dialog, then click the Precision tab.

    4. Check the Specify The Desired Precision For Forecast Statistics option.

    5. Check the Mean checkbox.

    6. Use an absolute precision of 1000 units.

  3. Start OptQuest and reload the optimization settings file you saved earlier.

  4. Run another optimization.

Experiment with various other precision control settings to see the difference in the results.