Volatility Primer 7: Portfolio Value Plots
The portfolio value plots show the accumulation of both risk and return in the investment account. The bottom line on the graph below shows two standard deviations below the mean return. The probability of the portfolio being above this value is 97.7%. This line hits zero at age 78, therefore the probability of not running out of money through age 78 is 97.7%. The second line from the bottom shows one standard deviation below the mean. The probability of the portfolio bein