A portfolio stress test asks how a chosen allocation behaves under a specified set of conditions. It is a way to examine assumptions, not a prediction of the next market event.
Start with your allocation
Choose the assets, investment amount, and weights. Weights should total 100%. Decide whether you are examining a one-time investment or a recurring contribution plan. A change in funding can change the ending balance independently of investment performance.
Historical crises and custom periods
Historical modes use the supported historical price series for the selected dates. They do not apply the AI beta formula to stocks and ETFs. Check actual coverage and the dates used for each asset. If an asset lacks history for a period, do not interpret a hypothetical fallback as observed performance.
AI scenarios are hypothetical
In the AI impact model, stock and ETF estimates use beta multiplied by the assumed S&P 500 change, unless a supported explicit asset shock takes priority. Crypto uses the scenario’s crypto assumption. The model estimates an impact on the current invested balance; it does not produce a verified future price path.
Beta is an estimate from historical co-movement. It does not capture every company-specific event or guarantee the response to a future shock. A scenario about one company should not be read as an exact forecast for all of its peers.
Read losses and assumptions together
Compare the estimated portfolio change with the individual asset changes and their allocation weights. Historical maximum drawdown measures a decline from a prior peak; an endpoint hypothetical loss is a different quantity. Do not infer recovery time from a single assumed price change.
Try a stress test
Explore Portfolio Stress Test → Start with a historical scenario, review the assumptions, then change one input at a time. AI Scenario Builder lets you create and verify hypothetical market assumptions.
Methodology and limitations
This is a guide to the NextInvested tool’s calculation modes, not a market forecast or completed stress study. No sample losses or recovery dates have been invented. Results depend on coverage, allocation, scenario inputs, and model limitations. Review the Scenario Assumptions section before relying on an output.