The Orizen Simulation: How Our Wealth Projection Engine Works

In our article on wealth simulation, we explained why projecting your wealth matters and why a simple "+5% per year" straight line doesn't cut it. This article takes you under the hood: how the Orizen simulation engine actually works, what design choices were made, and why every detail matters.

No engineering degree required. We'll explain everything in plain language.

Why a "Standard" Simulation Falls Short

Let's recap quickly. A linear projection takes your current wealth, applies a fixed percentage each year, and draws a nice upward curve. It's reassuring. It's also misleading.

In reality, your savings account and your cryptocurrencies don't behave anything alike. Real estate doesn't react like the stock market. And when a crisis hits, some assets plummet while others hold steady. A realistic simulation must capture these differences.

That's exactly what Orizen does.

The Orizen Engine in 4 Steps

Before diving into details, here's the big picture. For each simulated year, the engine does four things:

1. It draws a global economic scenario for the year (crisis, stability or euphoria)
2. It determines how each asset class reacts according to its nature
3. It integrates your debt repayments
4. It starts over — and does this 500 times to produce a realistic range

Let's unpack each step.

Economic Cycles: Crisis, Stability, Euphoria

The economy doesn't run in a straight line. It moves through cycles: periods of crisis (think 2008, early 2020), long phases of stability (most of the time), and periods of euphoria (think 2021, the late 1990s).

The Orizen engine models these cycles. Each simulated year begins with the draw of a macroeconomic scenario:

Crisis — markets suffer, confidence drops, valuations fall. This happens roughly 15% of the time. Not every year, but often enough that it would be reckless to ignore.

Stability — the most frequent scenario, about 70% of the time. The economy runs normally. Some ups, some downs, but no major shock.

Euphoria — markets soar, growth is strong, everything seems easy. About 15% of the time. Enjoyable, but dangerous to build your entire plan around.

This macro scenario sets the stage for the year. Then, each asset in your portfolio reacts in its own way.

Every Asset Has Its Own Personality

This is the core of what makes the Orizen simulation realistic. Each asset family has its own behaviour in response to economic cycles. To help you visualise, let's think in terms of sailing.

Savings: The Rock in the Storm

Your savings accounts — that's the rock. Whether storms rage or the sun shines, it barely moves. Returns are low but predictable, volatility is virtually zero.

In the Orizen engine, regulated savings are nearly independent from economic cycles. Whether the scenario is "crisis" or "euphoria", your savings account keeps earning its rate with minimal variation. It's your anchor, your safety net.

Real Estate: The Ocean Liner

Real estate is an ocean liner. It moves in the same direction as markets, but with considerable inertia. When the storm arrives, it doesn't sink — it slows down. When fair weather returns, it doesn't accelerate suddenly — it gradually picks up speed.

In normal conditions, real estate offers a moderate return around 2% per year, with contained volatility. In a crisis, it may lose a few percent, but rarely as much as stocks. This makes it a pillar of stability in a portfolio, as long as you don't concentrate 100% of your wealth in it.

Stocks: The Sailboat

Equities and ETFs are a sailboat. When the wind is good, it moves fast — average returns around 6% per year in normal conditions, and much more in euphoria. But when the storm arrives, it rocks seriously: average losses of 15% in a crisis, with much worse peaks possible.

Stocks are highly sensitive to economic cycles. They're the asset class that follows the macro scenario most closely. In return, they also offer the best long-term returns.

Private Equity: The Racing Yacht

Private equity pushes the dial further than stocks. Potential returns are higher in good times (roughly 10% on average), but losses in crisis are steeper (around -20%). Volatility is more pronounced across all scenarios.

It's an asset that closely tracks economic cycles and rewards patience — but can inflict significant short-term losses.

Crypto: The Kitesurfer

Cryptocurrencies are kitesurfing. Extreme sensations, in both directions. Returns can reach +120% in euphoria, but crisis losses can exceed -60%. Volatility is massive — far beyond any other asset class.

What makes crypto unique in our model is that it can diverge from the global scenario. It can rise during a stock market crisis or stagnate during a general euphoria. This partially independent behaviour makes it a diversification asset, but also a major risk source for anyone who concentrates too much wealth in it.

Valuables: The Safe Haven

Art, watches, wine collections — these assets have moderate behaviour. They offer some protection in crises (average losses limited to about -5%) and interesting returns in euphoria (up to +15%). Their correlation with economic cycles is moderate.

Their main weakness: liquidity. Selling a painting or a collector's watch takes time and involves costs. The engine simulates their returns, but remember that in practice, mobilising them quickly when needed is rarely straightforward.

Your Debts Are Part of the Equation Too

The Orizen simulation doesn't stop at assets. It integrates the gradual repayment of your debts — mortgage, consumer credit, car loans — based on the parameters you've entered in the app: monthly payments, interest rate, remaining duration.

Each simulated year, your liabilities decrease mechanically. This is an often-underestimated point: simply repaying your mortgage grows your net worth, even if your assets don't appreciate at all.

Here's a simple example: if your assets stay flat at €300,000 for 5 years but you repay €50,000 of your mortgage, your net worth goes from €100,000 to €150,000. That's a 50% increase with zero market returns.

500 Simulations: Not More, Not Fewer

Why does the Orizen engine run exactly 500 simulations? Not 5, not 10,000 — 500.

Imagine you want to know tomorrow's weather. If you ask one meteorologist, you get one opinion — maybe right, maybe not. If you ask 5, you get slightly more perspective, but one strong optimist or pessimist can skew the picture. If you ask 500, the extremes cancel out and a reliable trend emerges.

It's exactly the same principle.

With too few simulations (5 or 10), results change every time you rerun the calculation. Extreme trajectories — a total crisis scenario, a permanent euphoria scenario — carry too much weight in the average.

With too many simulations (5,000 or 10,000), the reliability gain becomes negligible (results barely change), but computation time explodes. And since the simulation runs in your browser, speed matters.

At 500, results are stable: rerun the calculation and the scenarios vary by less than 2%. It's the sweet spot — reliable enough to make decisions, fast enough to run in seconds.

What You See: Three Possible Paths

The 500 simulations are synthesised into three trajectories that you can visualise on a fan chart — three curves starting from the same point and gradually diverging:

The pessimistic scenario — 90% of simulations do better than this. It's your "reasonable worst case". In statistical terms, it's called the 10th percentile — but just think of it as: if your financial plan holds even in this scenario, you can sleep soundly.

The median scenario — the central trajectory. Half the simulations do better, half do worse. This is your reference scenario, the one you can reasonably base your decisions on.

The optimistic scenario — only 10% of simulations do better. This is the sunny weather — nice to imagine, but risky to build your entire plan around.

The fan widens over time: at 5 years, the three curves are still relatively close. At 25 years, they can be far apart. It's an honest visualisation of uncertainty.

And you can zoom in based on your needs:

• Total wealth — the evolution of your overall net worth
• By asset class — how your real estate, stocks or crypto evolve separately
• By individual asset — a specific property, a particular portfolio
• Over different horizons — 5 years for a concrete project, 10 years for active planning, 25 years for retirement

Free vs Premium: Which Simulation for Which Need?

Orizen offers two approaches, depending on where you are:

Free version: linear projection. Your wealth is projected at a constant growth rate per asset class. It's a useful first approximation to see the direction — but it doesn't account for crises, volatility, or correlations between your assets. If your wealth is simple (mainly savings), it's a good starting point.

Premium version: full Monte Carlo simulation. The 500 simulations with economic scenarios, asset correlations, realistic volatility, debt repayment, and the fan chart with all three scenarios. This is the tool that makes a difference when you have a diversified portfolio (real estate + stocks + crypto), outstanding loans, or a specific goal to reach.

The free version shows you where you could go. The premium version shows you the range of what can realistically happen — and it's this difference that enables truly informed decisions.

Limitations, in Full Transparency

We believe a reliable tool is one that's honest about what it doesn't do.

The simulation doesn't predict the future. Scenarios and parameters are calibrated on historical data and reasonable assumptions. They produce a credible range, not a certainty. Nobody — no algorithm, no bank — can predict markets.

Life events can't be modelled. A divorce, an unexpected inheritance, an illness: these events can radically change your wealth trajectory. The simulation doesn't include them, because they're inherently unpredictable. All the more reason to maintain a safety margin in your planning.

Correlations can shift. In a major crisis (like 2008), assets that are normally uncorrelated can fall in unison. Our model captures this tendency through macro scenario correlations, but extreme events (a "black swan") can always surprise.

Revisit your simulation over time. Your situation changes, markets evolve, your goals become clearer. Rerun the simulation at least once a year with your updated data to keep it relevant.

Conclusion

The Orizen simulation doesn't tell you what will happen. It shows you what could happen — on good days and bad — so you can decide with full visibility.

Every asset class has its own personality. Your debts are repaid progressively. Uncertainty is modelled honestly, not hidden behind a reassuring straight line.

If you're not yet clear on what net worth means, start there. If you need to complete your wealth assessment, that's the next step. And when you're ready to look ahead, the simulation is one click away.