Portfolio Management

Portfolio Management is a skill from the CLI Trader project that gives trading agents a structured approach to building, maintaining, and evaluating multi-asset portfolios across stocks, crypto, and DeFi positions. Developed by the CLI Trader team, this skill moves beyond individual trade decisions to address the higher-level question of how capital should be distributed across assets and strategies. It provides your agent with allocation frameworks, rebalancing logic, and performance measurement tools that turn a collection of individual positions into a coherent portfolio with defined risk characteristics.

The skill implements four major allocation frameworks — equal weight, risk parity, mean-variance optimization, and Black-Litterman — each with clear assumptions and trade-offs that the agent communicates when presenting allocation recommendations. Portfolio construction follows core-satellite and barbell approaches, where stable core holdings anchor the portfolio while a smaller allocation targets higher-risk opportunities in crypto or DeFi. Rebalancing is managed through three trigger types: calendar-based schedules for systematic maintenance, threshold-based triggers that fire when positions drift beyond defined bands, and tactical triggers that respond to correlation breakdown or regime shifts. The correlation monitoring module continuously tracks rolling correlations between positions and flags when historically uncorrelated assets begin moving together, which is precisely when diversification benefits disappear and portfolio risk spikes. Performance attribution decomposes returns using Brinson methodology, separating allocation effect from selection effect so you understand whether outperformance came from asset class timing or individual position selection. Risk metrics including Sharpe ratio, Sortino ratio, and maximum drawdown are calculated and tracked over rolling windows.

Within a trading workflow, this skill sits above individual trade analysis and acts as the capital allocation layer that determines how much risk budget is available for new positions. When your agent identifies a trade opportunity through technical or fundamental analysis, the portfolio management skill evaluates whether the trade improves or degrades overall portfolio characteristics — checking correlation with existing holdings, impact on sector concentration, and effect on aggregate risk metrics — before passing it through to the risk management gate. This ensures that individually attractive trades are only taken when they make the portfolio better as a whole.

For the complete methodology — including formulas, decision trees, worked examples, and validation checklists — see the full Portfolio Management skill guide.