Creating RNG (random number generator) in Excel

CFA General
#1

I know there is a way to create a random number if you provide an upper and lower limit. The problem is that it assumes a uniform distribution

How can I get a random number produced if I give

*A mean value

*A standard valuation

*The assumption that it’s a normal distribution

For example, let’s say I want to tell Excel that the average stock market return is 7%, with a standard deviation of 10% and that stock market returns look like a normal bell curve?

I am trying to make my Monte Carlo simulations more accurate.

#2

Use this: =NORMSINV(RAND())*(Desired SD) + (Desired Mean).

#3

Or get the student version of Crystal Ball.

#4

http://home.uchicago.edu/~rmyerson/addins.htm

This is the add-in I use for Monte Carlo at the moment. Give it a shot.