Stochastic modeling to improve 401k & IRA performance

Edward L. Stanton, Ph.D. Engineering Mechanics

Picture of Stochastic modeling pioneer & 401k-checkup creator, Ed Stanton PhD, Father of Patran.Dr. Stanton earned Bachelor and Master Degrees in Aerospace Engineering from the University of Southern California and his Ph.D. in Engineering Mechanics from Case Western Reserve University in Cleveland, Ohio. Due to his expertise in mathematical modeling, Dr. Stanton was chosen in the early 1960's to represent Douglas Aircraft on a team led by NASA that wrote the software specification for what became NASTRAN.

NASTRAN software was originally written to help DESIGN more efficient space vehicles for NASA's Apollo and Space Shuttle programs. After work with both NASA and other governmental agencies, Dr. Stanton joined PDA Engineering (which merged with MSC Software in 1994) and was at the forefront of a developing CAD/CAM/CAE industry. Dr. Stanton is known as the Father of Patran*, which introduced commercial applications of software that helped analyze the design of products including automobiles, aircraft, medical devices, heavy machinery, golf clubs and countless other products. Today, Patran's global applications simulate performance in the behavior of elastic structures regardless of size or shape for practically any purpose.

Dr. Stanton initially began using his modeling software to analyze his own retirement plan options in the late 1980's as a way to optimize his personal investment allocations. Working closely with his son Robert since the late 1990's, together they developed the PSDS tool for portfolio design and analysis that anyone managing portfolio risk can find useful. Dr. Stanton has used this software to analyze risk for several hundred company retirement plans @ Portfolio Stochastic Design Software

* Dr. Stanton's introduction in this video link begins at the 5:10 mark.

Robert J. Stanton

Picture of 401k-Checkup co-creator Stochastic modeling adherent, Bob Stanton.Robert Stanton (B.A. Economics, University of California, Irvine) was two decades into his financial services career when his father asked why there was no design testing in finance like there exists in engineering. Agreeing on a vision, the father-son team began working in 2003 on a tool for portfolio design testing that would simulate outcomes of an existing portfolio.

The pair set out with the goal of creating a stochastic modeling tool that merged financial modeling with portfolio management using risk analysis software. They based the mathematics on stochastic (based on probability theory) models Dr. Stanton had developed in a six decade career of engineer design testing. Robert’s 30 years of business experience allowed them to incrementally craft a tool specific to portfolio (asset) management.

The result of their effort, Portfolio Stochastic Design Scan (PSDS) Reports, is a unique illustration of possible outcomes for different allocations within an existing portfolio. 401k-Checkup™ is the first application of PSDS Reports available to the individual investor. 401k-Checkup™ is a tool for analyzing the risk and reward of any existing portfolio, presented in an easy to understand format.

"While I was first excited about working with my father and finding a solution to how WE allocated portfolios...my Dad was hoping to develop a way to help ALL 401k investors. My Dad's goal was more altruistic than mine I confess. After 10 years of development and use, I became determined to find a way to achieve my father's wish to make this tool available to individual investors. This website and a 401k-Checkup™ can be used by anyone and we hope it is."

It Is Rocket-Science: The History of 401k-Checkup

Over the decade working with my Dad a lot happened...during this time we came to know of the Fisher House Foundation and have decided to donate 5% of our revenue to this organization and its worthy cause. ~Robert "Bob" Stanton~

 
Link to Fisher House Site