Svenesis.org3-Bucket vs. 1-Bucket Portfolio Simulation
Monte Carlo Strategy Comparison for Your Investment Planning
The 3-Bucket vs. 1-Bucket Portfolio Simulation is a financial planning tool that compares different withdrawal strategies. It simulates both the proven Bucket Strategy (3-bucket) and a simple single-portfolio strategy (1-bucket), taking into account historical market crises and modern volatility models.
💹 I built this tool purely for fun and out of my passion for finance – free to use and available to everyone.
If you find it useful and would like to support my work, a coffee is always welcome:
Video Introduction
The Two Strategies Compared
1-Bucket Strategy
All assets remain in a single portfolio. Withdrawals are taken directly from it regardless of current market conditions. Simple to manage, but vulnerable to sequence-of-returns risk during market downturns.
3-Bucket Strategy
Assets are split into three buckets by time horizon: Bucket 1 (short-term/liquid, e.g. cash covering 1–2 years of expenses), Bucket 2 (medium-term/stable, e.g. bonds for 3–7 years), Bucket 3 (long-term/growth-oriented, e.g. equity ETFs). Withdrawals come from Bucket 1, which is periodically refilled from the other buckets.
Features
Monte Carlo Simulation
Thousands of random market paths are calculated to produce a statistical distribution of possible portfolio outcomes – far more realistic than simple linear projections.
Strategy Comparison
Direct comparison of the 1-bucket and 3-bucket approaches based on your own Parqet data – using identical market scenarios for both strategies.
Risk Analysis
Visualisation of best-case, median, and worst-case scenarios – so you know what to expect even in adverse market conditions.
100 % Privacy
All calculations run entirely in your browser. No data is ever sent to external servers.
Frequently Asked Questions
What is a Monte Carlo simulation?
A Monte Carlo simulation is a mathematical method that calculates thousands of random scenarios to estimate the range of possible outcomes. In finance, it is used to simulate potential market movements, giving a more realistic view of risk and opportunity than simple forecasts.
What is the difference between 1-bucket and 3-bucket?
With the 1-bucket approach, all capital sits in a single portfolio – withdrawals are taken directly from it no matter how markets are performing. With the 3-bucket approach (Bucket Strategy), assets are separated by time horizon: Bucket 1 covers near-term expenses from safe liquid funds, Bucket 2 holds medium-term stable investments, and Bucket 3 is invested in long-term growth assets. This separation protects against being forced to sell equities at a loss during market crises.
Is the simulation free?
Yes, the tool is free and developed and maintained in my spare time.
Is my data stored anywhere?
No. All calculations happen exclusively in your browser. There is no server that processes or stores your data.
Are the results a guarantee of future returns?
No. The simulation is based on historical data and statistical models. Past performance is not a reliable indicator of future results.