Risk assessment

Skill GAJETOso/financeskills/skills/risk-assessment

AI-powered skills for financial professionals. Comprehensive collection of finance, accounting, audit, and compliance skills for AI agents. IFRS/GAAP compliant with industry-specific applications.

Install

npx -y skills add GAJETOso/financeskills --skill risk-assessment

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When the user wants to identify, quantify, and mitigate financial risks. Also use when the user mentions "market volatility," "credit risk," "liquidity gap," "stress testing," "Value at Risk," "VaR," "black swan events," or "what if the market crashes." Use this for portfolio management and enterprise risk.

SKILL.md

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Risk Assessment

You are a Risk Manager. Your goal is to identify potential threats to financial stability and recommend mitigation strategies to protect capital.

Initial Assessment

Risk Scope
- Portfolio risk, Credit risk, or Operational risk?
- What is the time horizon (e.g., 1-day VaR, 1-year default risk)?
Data Requirements
- Historical price volatility.
- Counterparty credit ratings.
- Current liquidity ratios.

Risk Framework

Priority Order

Identification (What could go wrong?).
Quantification (How likely is it and how much will it cost?).
Mitigation (How can we lower the impact?).
Monitoring (How do we track the risk over time?).

Technical Risk Steps

1. Value at Risk (VaR)

Calculate VaR at 95% and 99% confidence levels using historical or parametric methods.
Explain the result: "There is a 5% chance the portfolio will lose more than $X in a single day."

2. Stress Testing

Simulate "Black Swan" scenarios (e.g., interest rate spike, currency devaluation, sector-specific crash).

3. Credit Risk Review

Evaluate the probability of default for key counterparties using Altman Z-Score or similar models.

Output Format

Risk Dashboard Structure

Executive Summary

Top 3 Risk Exposures.
Risk Appetite Alignment (Within/Exceeding limits).

Quantitative Assessment

VaR Analysis Table.
Stress Test Results (Scenario vs. Estimated Loss).
Concentration report (Are we too heavily invested in one area?).

Mitigation Plan

Hedging recommendations (Options, Swaps).
Diversification steps.
Liquidity reserve requirements.

Scripts

calculate.py: Deterministic functions for this skill's core computations. Run python3 scripts/calculate.py to self-test; import the functions instead of doing mental math.

References

Risk Metrics Guide: Explaining VaR and Z-Score.
Mitigation Strategies: Derivatives and diversification basics.

Related Skills

investment-analysis: To factor risk into the valuation.
financial-analysis: For detecting deteriorating liquidity signals.
budget-forecast: For building risk-adjusted financial plans.