Investment Analysis & Portfolio Management Engine

Complete investment analysis, portfolio construction, risk management, and trade execution methodology. Works across stocks, crypto, ETFs, bonds, and alternatives. Zero dependencies — pure agent skill.

Quick Health Check (/8)

Before any investment activity, score your current state:

| Signal | ✅ Healthy | ❌ Fix First | |--------|-----------|-------------| | Investment thesis documented | Written with edge + invalidation | "I think it'll go up" | | Position sizing calculated | Kelly/fixed-fractional with max cap | "I'll put in $5K" | | Stop-loss defined | Price or thesis invalidation trigger | No exit plan | | Portfolio heat tracked | Total exposure known, <15% | Unknown aggregate risk | | Asset correlation checked | No >40% correlated concentration | All tech / all crypto | | Rebalance schedule set | Monthly or threshold-based | Never rebalanced | | Tax impact considered | Harvesting losses, holding periods | Tax-blind trading | | Performance tracked | Benchmarked vs buy-and-hold | "I think I'm up" |

Score /8. Below 5 = fix fundamentals before any new positions.

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Phase 1: Investment Thesis Development

Every position starts with a thesis. No thesis = no trade.

Thesis Brief Template

thesis:
  ticker: "AAPL"
  asset_class: "equity"  # equity | crypto | etf | bond | commodity | real_estate
  date: "2026-02-22"
  
  # THE EDGE — why does this opportunity exist?
  edge:
    type: "mispricing"  # mispricing | catalyst | trend | mean_reversion | structural
    description: "Market pricing in worst-case regulation; actual impact is 5-10% revenue, not 30%"
    why_others_miss_it: "Headline risk scaring generalists; specialists still buying"
    
  # THESIS STATEMENT (one sentence)
  thesis_statement: "AAPL is undervalued by 20% due to regulatory FUD; earnings growth will re-rate within 2 quarters"
  
  # TIMEFRAME
  timeframe:
    horizon: "3-6 months"
    catalyst_date: "2026-04-15"  # earnings, FDA, macro event
    catalyst_type: "earnings_beat"
    
  # BULL / BASE / BEAR
  scenarios:
    bull:
      probability: 30
      target_price: 245
      thesis: "Regulation light + Services acceleration"
    base:
      probability: 50
      target_price: 215
      thesis: "Regulation moderate, priced in by Q3"
    bear:
      probability: 20
      target_price: 165
      thesis: "Full regulatory impact + macro downturn"
      
  # EXPECTED VALUE
  # EV = (P_bull × R_bull) + (P_base × R_base) + (P_bear × R_bear)
  current_price: 190
  expected_value: 213.5  # (0.3×245 + 0.5×215 + 0.2×165)
  ev_vs_current: "+12.4%"
  
  # INVALIDATION — when you're WRONG
  invalidation:
    price_stop: 175  # -7.9% from entry
    thesis_stop: "Revenue decline >10% YoY in any segment"
    time_stop: "No catalyst by 2026-07-01"
    
  # CONVICTION (1-5)
  conviction: 4
  conviction_factors:
    - "3 independent data sources confirm undervaluation"
    - "Insider buying last 90 days"
    - "Valuation below 5Y average on EV/EBITDA"

Edge Type Framework

| Edge Type | Description | Validation Method | Decay Rate | |-----------|-------------|-------------------|------------| | Mispricing | Market wrong on fundamentals | Comp analysis + model | Slow (months) | | Catalyst | Known upcoming event | Calendar + probability | Fast (event-driven) | | Trend | Momentum / technical | Price action + volume | Medium (weeks) | | Mean Reversion | Extreme deviation from norm | Z-score + history | Medium | | Structural | Market structure creates opportunity | Flow analysis | Slow |

Thesis Quality Checklist

• [ ] Edge clearly articulated (not just "it's cheap")
• [ ] Bull/base/bear with probabilities summing to 100%
• [ ] Expected value positive vs current price
• [ ] At least 2 independent data sources
• [ ] Invalidation criteria defined (price + thesis + time)
• [ ] Timeframe realistic for the edge type
• [ ] Not just consensus view repackaged
• [ ] Considered "what if I'm wrong?"

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Phase 2: Fundamental Analysis

Equity Analysis Framework

Valuation Metrics (collect all, weight by sector)

valuation:
  # Price Multiples
  pe_ratio: null          # Price / Earnings (TTM)
  forward_pe: null        # Price / Forward Earnings
  peg_ratio: null         # PE / Earnings Growth Rate
  ps_ratio: null          # Price / Sales
  pb_ratio: null          # Price / Book
  ev_ebitda: null         # Enterprise Value / EBITDA
  ev_revenue: null        # Enterprise Value / Revenue
  fcf_yield: null         # Free Cash Flow / Market Cap
  
  # Compare to:
  sector_median: null
  historical_5y_avg: null
  historical_range: [null, null]  # [low, high]
  
  # Verdict
  valuation_score: null   # 1-10 (1=very expensive, 10=very cheap)
  relative_to_sector: null  # premium | inline | discount

Financial Health Scorecard

| Dimension | Metric | Healthy | Warning | Danger | |-----------|--------|---------|---------|--------| | Profitability | Gross Margin | >50% | 30-50% | <30% | | Profitability | Net Margin | >15% | 5-15% | <5% | | Profitability | ROE | >15% | 8-15% | <8% | | Profitability | ROIC | >12% | 6-12% | <6% | | Growth | Revenue YoY | >15% | 5-15% | <5% | | Growth | EPS YoY | >10% | 0-10% | Declining | | Growth | FCF Growth | >10% | 0-10% | Declining | | Leverage | Debt/Equity | <0.5 | 0.5-1.5 | >1.5 | | Leverage | Interest Coverage | >8x | 3-8x | <3x | | Leverage | Net Debt/EBITDA | <2x | 2-4x | >4x | | Liquidity | Current Ratio | >1.5 | 1-1.5 | <1 | | Liquidity | Quick Ratio | >1.0 | 0.5-1 | <0.5 | | Efficiency | Asset Turnover | >0.8 | 0.4-0.8 | <0.4 | | Efficiency | Inventory Days | <60 | 60-120 | >120 | | Quality | FCF/Net Income | >80% | 50-80% | <50% | | Quality | Accruals Ratio | <5% | 5-10% | >10% |

Score each dimension 1-3. Total /48. Above 36 = strong. Below 24 = avoid.

Moat Assessment (0-25 points)

| Moat Source | Score 0-5 | Evidence Required | |-------------|-----------|-------------------| | Network Effects | | Users increase value for other users | | Switching Costs | | Painful to leave (data lock-in, integrations) | | Cost Advantages | | Structural cost below competitors | | Intangible Assets | | Brand, patents, regulatory licenses | | Efficient Scale | | Market only supports limited competitors |

Score /25. Above 15 = wide moat. 8-15 = narrow. Below 8 = no moat.

Crypto Analysis Framework

crypto_analysis:
  # Network Fundamentals
  network:
    daily_active_addresses: null
    transaction_volume_24h: null
    hash_rate_trend: null        # BTC/PoW
    staking_ratio: null          # PoS chains
    developer_activity: null     # GitHub commits 90d
    tvl: null                    # DeFi protocols
    tvl_trend_30d: null
    
  # Tokenomics
  tokenomics:
    supply_schedule: null        # inflationary | deflationary | fixed
    circulating_vs_total: null   # % circulating
    unlock_schedule: null        # upcoming unlocks
    concentration: null          # top 10 holders %
    
  # On-Chain Signals
  on_chain:
    exchange_reserves_trend: null  # decreasing = bullish
    whale_accumulation: null       # large wallet changes
    realized_profit_loss: null     # NUPL
    mvrv_ratio: null               # Market Value / Realized Value
    
  # Market Structure
  market:
    funding_rate: null           # perpetuals funding
    open_interest_trend: null
    spot_vs_derivatives_volume: null
    correlation_to_btc: null
    correlation_to_sp500: null

Crypto Valuation Methods

| Method | Best For | Formula | |--------|----------|---------| | Stock-to-Flow | BTC | Price = 0.4 × S2F^3 (check vs actual) | | NVT Ratio | L1 chains | Network Value / Daily Transaction Value | | TVL Ratio | DeFi | Market Cap / TVL (below 1 = undervalued) | | Fee Revenue Multiple | Revenue-generating | MC / Annualized Fees | | Metcalfe's Law | Network tokens | Value ∝ n² (active addresses) |

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Phase 3: Technical Analysis

Price Action Framework

technical_analysis:
  ticker: "BTC-USD"
  timeframe: "daily"
  date: "2026-02-22"
  
  # TREND
  trend:
    primary: "uptrend"    # uptrend | downtrend | range
    higher_highs: true
    higher_lows: true
    above_200ma: true
    above_50ma: true
    ma_alignment: "bullish"  # 20 > 50 > 200 = bullish
    
  # KEY LEVELS
  levels:
    resistance: [105000, 110000, 120000]
    support: [95000, 88000, 80000]
    current_price: 98500
    distance_to_resistance: "+6.6%"
    distance_to_support: "-3.6%"
    
  # MOMENTUM
  momentum:
    rsi_14: 58           # <30 oversold, >70 overbought
    rsi_divergence: null # bullish_div | bearish_div | none
    macd_signal: "bullish"  # bullish | bearish | neutral
    macd_histogram_trend: "increasing"
    
  # VOLUME
  volume:
    vs_20d_avg: "+15%"
    trend: "increasing_on_up_days"  # confirms trend
    
  # PATTERN
  pattern:
    current: "ascending_triangle"
    reliability: "high"
    target: 112000
    invalidation: 93000

Signal Scoring Matrix

| Factor | Bullish (+) | Neutral (0) | Bearish (-) | |--------|-------------|-------------|-------------| | Trend (weight 3x) | Above 200MA, higher highs | Ranging | Below 200MA, lower lows | | Momentum (weight 2x) | RSI 40-60 rising, MACD bull cross | RSI 45-55 flat | RSI >75 or bearish div | | Volume (weight 2x) | Rising on up moves | Average | Rising on down moves | | Support/Resistance (weight 1x) | Near strong support | Mid-range | Near strong resistance | | Pattern (weight 1x) | Bullish continuation | No pattern | Bearish reversal |

Score -9 to +9. Above +5 = strong buy signal. Below -5 = strong sell signal.

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Phase 4: Position Sizing & Risk Management

Position Sizing Rules (MANDATORY)

risk_rules:
  # Per-Trade Risk
  max_risk_per_trade: 2%       # of total equity
  max_risk_aggressive: 3%      # only with 5/5 conviction
  
  # Portfolio Heat
  max_portfolio_heat: 15%      # total risk across all positions
  max_correlated_exposure: 25% # in correlated assets
  max_single_position: 10%     # of total equity
  
  # Position Size Formula
  # Position Size = (Account × Risk%) / (Entry - Stop Loss)
  # Example: ($100K × 2%) / ($190 - $175) = $2,000 / $15 = 133 shares
  
  # Kelly Criterion (optional, aggressive)
  # f* = (bp - q) / b
  # b = win/loss ratio, p = win probability, q = 1-p
  # ALWAYS use Half-Kelly or Quarter-Kelly (full Kelly = too aggressive)

Position Size Calculator

Account Equity:     $___________
Risk Per Trade:     ___% (max 2%)
Dollar Risk:        $___________  (equity × risk%)
Entry Price:        $___________
Stop Loss Price:    $___________
Risk Per Share:     $___________  (entry - stop)
Position Size:      ___________ shares (dollar risk / risk per share)
Position Value:     $___________  (shares × entry)
Portfolio Weight:   ___%          (position value / equity)

CHECK: Portfolio weight < 10%?  ☐ Yes ☐ No (reduce if no)
CHECK: Portfolio heat < 15%?    ☐ Yes ☐ No (reduce if no)
CHECK: Correlated exposure ok?  ☐ Yes ☐ No (reduce if no)

Stop-Loss Decision Tree

Is this a TREND trade?
├── YES → Trailing stop below swing low (ATR-based: 2× ATR)
│         Initial stop: Below last higher low
│         Trail: Move stop to below each new higher low
│
└── NO → Is this a CATALYST trade?
    ├── YES → Time-based + price stop
    │         Price: Below pre-catalyst support
    │         Time: Close if no move within 2 days post-catalyst
    │
    └── Is this a VALUE trade?
        ├── YES → Thesis invalidation stop
        │         Price: Below bear case scenario price
        │         Thesis: Close if fundamental thesis breaks
        │         Time: Close if no re-rating in stated timeframe
        │
        └── MEAN REVERSION → Tight stop
            Price: If moves further from mean (wider Z-score)
            Target: Mean / fair value level

Risk Management Hard Rules

1. Never average down without a plan — Adding to losers kills accounts. Only add if: thesis intact AND