About Prompt
- Prompt Type – Dynamic
- Prompt Platform – ChatGPT, Grok, Deepseek, Gemini, Copilot, Midjourney, Meta AI and more
- Niche – Portfolio Risk Analysis
- Language – English
- Category – Risk Management
- Prompt Title – AI Prompt for Risk Assessment of Investment Portfolios
Prompt Details
**Prompt Type:** Dynamic
**Purpose:** Risk Management of Investment Portfolios
**Target Audience:** All AI Platforms
**Instructions:**
This prompt aims to generate a comprehensive risk assessment for an investment portfolio. Please provide the following information in a structured format (e.g., JSON, CSV, or a clear, delimited text format) to enable the AI to perform a robust analysis. The more detailed the input, the more nuanced and accurate the output will be.
**Required Input Data:**
* **Portfolio Composition:**
* List of assets (e.g., stocks, bonds, ETFs, real estate, commodities, cryptocurrencies).
* For each asset:
* Ticker symbol or unique identifier.
* Quantity held.
* Current market value.
* Historical price data (at least 1 year, preferably 5+ years; daily or weekly frequency).
* **Investment Horizon:** Specify the timeframe over which the portfolio is being assessed (e.g., short-term: <1 year, medium-term: 1-5 years, long-term: 5+ years). * **Risk Tolerance:** Describe the investor's risk tolerance (e.g., conservative, moderate, aggressive). Include specific details regarding the investor's willingness to accept potential losses. For example, specify the maximum acceptable drawdown percentage. * **Benchmark (Optional):** Provide a benchmark index or portfolio against which to compare the performance and risk characteristics of the given portfolio. (e.g., S&P 500, a specific bond index). * **Specific Risk Concerns (Optional):** Specify any particular risk factors of concern, such as interest rate risk, inflation risk, geopolitical instability, specific sector risks, or individual company risks. **Desired Output:** A comprehensive risk assessment report including the following: * **Quantitative Risk Metrics:** * Standard Deviation: Calculate the volatility of the portfolio's returns. * Value at Risk (VaR): Estimate the potential loss in portfolio value at a given confidence level (e.g., 95% or 99%) over a specified time horizon. * Conditional Value at Risk (CVaR/Expected Shortfall): Estimate the expected loss given that the loss exceeds the VaR threshold. * Sharpe Ratio: Measure the risk-adjusted return of the portfolio. * Beta (if benchmark provided): Measure the portfolio's sensitivity to market movements relative to the benchmark. * Maximum Drawdown: Calculate the largest peak-to-trough decline in portfolio value. * Correlation Matrix (for assets in the portfolio): Show the pairwise correlations between asset returns. * **Qualitative Risk Assessment:** * Discussion of key risk factors impacting the portfolio, based on the provided input data and current market conditions. * Analysis of the portfolio's diversification and concentration risks. * Assessment of the alignment between the portfolio's risk profile and the investor's stated risk tolerance and investment horizon. * Identification of potential vulnerabilities to specific risk scenarios (e.g., rising interest rates, economic recession). * **Scenario Analysis (Optional):** If specific risk concerns are provided, perform scenario analysis to assess the potential impact of those scenarios on the portfolio's value and risk metrics. * **Recommendations (Optional):** Suggest potential adjustments to the portfolio to mitigate identified risks or improve risk-adjusted returns, taking into consideration the investor's risk tolerance and investment horizon. This could include suggestions regarding diversification, asset allocation, or hedging strategies. **Important Considerations:** * Clearly specify the units for all values (e.g., currency, percentages). * Explain any assumptions made in the analysis. * Use clear and concise language, avoiding technical jargon where possible. * Present the results in a well-organized and easy-to-understand format. **Example Input Snippet (JSON):** ```json { "portfolio": [ {"ticker": "AAPL", "quantity": 100, "marketValue": 17000, "historicalData": "..."}, {"ticker": "GOOG", "quantity": 50, "marketValue": 12000, "historicalData": "..."} // ... more assets ], "investmentHorizon": "long-term", "riskTolerance": "moderate", "benchmark": "SPY", "specificRiskConcerns": ["inflation", "interest rate risk"] } ``` This structured prompt allows for dynamic adjustments to the input data, making it adaptable for various portfolio compositions, risk profiles, and investment horizons. By adhering to these guidelines, you can leverage the power of AI to generate detailed and actionable risk assessments for informed investment decision-making.