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risk-management-trading

Apply formal risk-management rules to size trades and protect capital.

Updated Nov 25, 2025
Search Tags:#risk-management#volatility#stop-loss#position-sizing#drawdown#kelly-criterion#portfolio-risk
One-click install
npx skills add https://github.com/Cambixx/bot-trading --skill risk-management-trading
Or copy as Structured Prompt for Agent▼
Please help me install this Agent Skill.
Skill: risk-management-trading
Source: https://github.com/Cambixx/bot-trading/tree/main/.agents/skills/risk-management-trading
Command: npx skills add https://github.com/Cambixx/bot-trading --skill risk-management-trading

SYSTEM DOCUMENTATION & REQUIREMENTS

What problem does it solve?

This skill solves the problem of capital erosion from poor risk management by establishing disciplined risk sizing, stop rules, and portfolio risk controls.

Core Features & Use Cases

  • Risk-based sizing using Kelly and volatility-adjusted methods for single and multi-asset portfolios.
  • Stop optimization & drawdown controls to protect capital during drawdowns and regime shifts.
  • Correlation-aware risk budgeting to account for co-movements and tail risk in crises.

Quick Start

Configure an initial risk per trade (e.g., 1%), set ATR-based stops, and enable a two-indicator convergence check for entry signals.

Frequently Asked Questions about risk-management-trading

High-intent search queries and answers about installing and using this skill.

FAQPage Schema
How do I calculate position sizing for multiple assets using the Kelly criterion?▼

Volatility-adjusted sizing scales trade exposure by applying ATR-based stops and explicit risk per trade percentages. This protects capital from drawdowns and regime shifts by dynamically adjusting position sizes to current market volatility.

What is the best way to manage portfolio drawdown and tail risk?▼

To start with risk management, configure an initial risk per trade, such as 1%, set ATR-based stops, and enable a two-indicator convergence check for entry signals. This establishes disciplined sizing and stop rules to prevent capital erosion.

Can I use volatility-based stops for a multi-asset trading portfolio?▼

Fixed fractional sizing limits capital erosion by risking a set percentage of capital per trade, while Kelly criterion sizing mathematically optimizes growth. Both require explicit risk per trade and objective risk metrics to guide decisions.

Why does correlation-aware risk budgeting matter for crisis tail risk?▼

Correlation-aware risk budgeting matters because it accounts for asset co-movements and tail risk during crises. By adjusting position sizes based on correlations, it prevents concentrated losses when multiple assets drawdown simultaneously.

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