Mining Investment Risk Analysis Based on Monte Carlo Simulation

When investing mining projects, we often cannot make an accurate judgment of the investing project´s risk degree because there are too many influential risk factors, with different kinds of uncertainties at the same time. To solve this problem, Monte Carlo simulation method is an effective way. It can be accomplished by computer software with enough times of sampling process. The analysis of the output can help judge the degree of risk. In this paper, the Monte Carlo simulation was performed in computer and applied to an iron ore mine investment. Base on the simulating results, this project´s investing risk was analyzed. We illustrated the meanings of the simulation results and also provided suggestions to the investors.