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This scenario analysis page includes files, videos and excerpts from my book that allow you to quickly add scenario analysis to any excel file. The scenario analysis discussion begins with a basic discussion of how to build data tables. After scenario analysis is addressed using the excel data table tool, a number of exercises and videos explain how to build scenario analysis with macros instead of data tables. I have also included discussion of how to use and build the scenario reporter. The scenario reporter is a file that you can add to any of your spreadsheets and then name and record scenarios. I have divided the files into three lesson sets. The first lesson set addresses data tables which you can probably find in thousands of other videos. The second video set moves to more advanced issues with use of macros that can dramatically improve data tables and use of various techniques to make the scenario analysis more flexible. The third video set explains how you can use and create a scenario reporter.

The first video provides and example of a finished file. Other exercises walk through how to start with a simple example and ultimately make a very flexible analysis and a nice summary page.

Scenario Lesson Set 1: Adding Master Scenario Page to Any Model

To make a master scenario page that has a base case, upside case and downside case, you can use the INDEX function combined with the DATA TABLE tool of excel. To do this, you should understand how a data table works and how the INDEX function can be used with a code number. The steps in this process include:

1. Set-up of a Separate Master Scenario page in Basic Model
Objective of Scenario Page
Understanding Data Tables for Scenario Analysis
Use of Code Number and INDEX or CHOOSE Functions
Presentation of Cash Flow Data with SUMIF
Putting together Scenario Analysis





Exercise Files for Construction of Basic Scenario Analysis







Files Associated with Videos






The above file is a template for adding scenario tabulations to any financial model




The above file includes a tornado diagram with the Offset function to accept flexible different series






The above file has a waterfall chart with a sensitivity analysis




Scenario Lesson Set 2: Using Macros in Scenario Analysis


Alternative to Data Tables in Scenario Analysis
Problems with Copy and Paste Macros in Models
Use of Goal Seek in Models
Creating Data Tables with Macros
Power of FOR loops with CELLS function

Video Creating Data Tables and Scenario Analysis (If the music is too low, try headphones if you have them)




The above file shows how you can make effective graphs from data tables





The above file uses a macro to create a one way data table




The above file reviews data tables in the context of structured finance





The above file shows how to make a more flexible data table with macros





The above file shows how to speed up data tables with range names






The above file uses a macro with a goal seek and a macro table










Subject

Excel Exercise File

Video

Chapter Reference

Page Reference











Two Way Data Table with Structured Finance Model

CDO Exercise 2

https://www.youtube.com/watch?v=iGnjWYW-zIc

Chapter 16

193

One Way Data Table with Structured Finance Model

CDO Exercise 2

https://www.youtube.com/watch?v=Tip6i7pYEt4

Chapter 16

201

Basic One Way and Two Way Data Tables

Exercise 1: Data Tables without Macros

https://www.youtube.com/watch?v=7s2GiemfZdg

Chapter 16

193

Data Table with Macro - No Range Name

Exercise 2: Data Tables with Macros

https://www.youtube.com/watch?v=xR-NwFZ2ANU

Chapter 16

201

Flexible Two Way Data Tables with Macros and Range Names

Exercise 3: Flexible Data Tables with Macros

https://www.youtube.com/watch?v=UIeSTdiPNik

Chapter 16

203

Creating Graphs from Data Tables

Exercise 4: Graphs from Data Tables

https://www.youtube.com/watch?v=0StOCE_yjNc

Chapter 15

174

Flexible One Way Data Tables with Macros and Range Names

Exercise 5: Flexible One Way Data Tables with Macros

https://www.youtube.com/watch?v=GfhlYG5rxRc

Chapter 16

203

Goal Seek, Macros and Data Table Macros

Exercise 6: Goal Seek Macros and Data Table Macros

https://www.youtube.com/watch?v=jroLGvUXj40

Chapter 42

541

Auto Open Macro to Set Calculation Method

Exercise 7: Data Tables and Auto_Open Macro

https://www.youtube.com/watch?v=RhXFHCp7Pic

Chapter 16

193

Use of Calculatebeforesave = False to Save Fast

Exercise 8: Data Tables and Save

https://www.youtube.com/watch?v=acW9Fo0KSFQ

Chapter 16

198

Basic Scenario Analysis with INDEX and Data Table

Exercise 9: Basic Scenario Analyisis

https://www.youtube.com/watch?v=fX5yUl-2uj4

Chapter 17

212

Sensitvity Analysis with INDEX and Data Table

Exercise 10: Basic Sensitivity Analysis

https://www.youtube.com/watch?v=MKFx1g5vlKA

Chapter 18

234

Creating a Custom Scenario without Macros

Exercise 11: Basic Custom Scenario Case

https://www.youtube.com/watch?v=4npJiOPGop4

Chapter 17

223

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Exercies that Demonstrate How to Create Scenario, Spider Diagrams and Tornado Diagrams


This page contains exercises and explanations for adding tornado diagrams and spider diagrams to your models. Once you get used to just a couple funcitions in excel, I am convinced that you can very easily add the scenario and other types of analyses to any of your models. All of the exercise in one way or another use a combination of the INDEX and DATA TABLE functions in excel. It is fairly easy to program the INDEX fucntion and DATA TABLES in excel; the key is to know how to creatively use the commands in combination.

Due to the importance of this risk analysis, the tools below include video explanations as well as the exerciese and also documentation in power point slides.

Subject

Excel Exercise File

Video

Chapter Reference

Page Reference









Basic Tornado Diagram

Scenario and Tornado Exercise

https://www.youtube.com/watch?v=0x1sx5YKpr8

Chapter 16

193
Sorting a Tornado Diagram

Scenario and Tornado Exercise Finished

https://www.youtube.com/watch?v=kH41VDGakqM




Tornado Diagram with Two Way Table

Scenario and Tornado Exercise Two Way Table

https://www.youtube.com/watch?v=fdO6p22ngow




Showing Low and High Case Values in Tornado Diagram








Tornado Diagram in Project Finance Model








Tornado Diagram with Alternative Base Case








Spider Diagram with Constant Increments








Spider Diagram with Variable Increments

















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Exercies for Creating Tornado Diagrams
Note: the template for creating tornado diagrams is in the risk analysis templates



Combination of Scenario and Sensitivity


This file contains an example of how to combine scenario and sensitivity analysis whereby you can create a base case and then perform sensititivy analysis on different varaibles in the base case. Alternatively you can create a downside case and then perform sensitivity analysis on variables in the downside case etc. This approach allows you to retain base case variables and also analyse downside cases on individual items. To create the scenario analysis, you can use data tables, index functions and some simple VBA code. An example of the approach is shown in the file below.





Video Instructions for Scenario Manager
Power point slides for Scenario Manager

Scenario Analysis using Data Table and Index

Power point slides that explain the risk analysis models
Exercise for Creating Spider Diagrams
Exercise for creating data tables with VBA
Exercise for Creating a one-way and two way data table





Scenario Analysis Part 1.JPG
Flexible Scenario.JPG

Scenario Analysis Advanced.JPG

Scenario Analysis 2.JPG

Data Table Fix.JPG