The Optimal Estimation Method is used to retrieve temperature and water vapor profiles from simulated radio occultation measurements in order to assess possible assimilation impacts of this data. High resolution ECMWF global fields are used by 5 a state-of-the-art radio occultation simulator to provide quasi-realistic bending angle and refractivity profiles. Both types of profiles are used in the retrieval process to assess their advantages and disadvantages. The impact of the GPS measurement is expressed as an improvement over the a priori knowledge (taken from a 24 h old analysis). Large improvements are found for temperature in the upper troposphere and 10 lower stratosphere. Only very small improvements are found in the lower troposphere, where water vapor is present. Water vapor improvements are only significant between about 1 km to 7 km. No pronounced difference is found between retrievals based upon bending angles or refractivity. Results are compared to idealized retrievals, where the atmosphere is spherically symmetric and instrument noise is not included. Comparing 15 idealized to quasi-realistic calculations shows that the main impact of a ray tracing algorithm can be expected for low latitude water vapor, where the horizontal variability is high. We also address the effect of altitude correlations in the temperature and water vapor. Overall, we find that water vapor and temperature retrievals using bending angle profiles are significantly more CPU intensive than refractivity profiles, but that they do 20 not provide significantly better results.