references/asset-allocation.md

# longbridge-asset-allocation

Prompt-only analysis skill. Explains major asset-allocation frameworks (MPT efficient frontier, Black-Litterman, risk parity, all-weather) and, when the user is logged in, applies them to their actual Longbridge portfolio data.

## Workflow

1. **Framework selection**: identify which allocation approach the user wants (MPT / Black-Litterman / risk parity / all-weather / practical advice).
2. **Account data** (if logged in): fetch current positions and 252-day price history for each holding.
3. **Explain the framework** with the user's actual holdings as context.
4. **Generate suggested target weights** based on the chosen framework.
5. Present the allocation with rationale.

## CLI

Run `longbridge <subcommand> --help` to verify exact flags before calling.

```bash
# Current holdings (if user is logged in)
longbridge portfolio --format json
longbridge positions --format json

# 252-day daily price history for each holding (run concurrently; ~1 year for covariance)
longbridge kline <SYMBOL> --period day --count 252 --format json

# Optional: valuation context
longbridge calc-index <SYMBOL> --format json
```

## Framework Reference

### MPT (Modern Portfolio Theory)

- Compute expected return (historical mean daily return × 252) and covariance matrix from 252-day returns.
- Find minimum-variance portfolio and tangency portfolio (max Sharpe).
- Caution: MPT is sensitive to input estimation error; treat outputs as directional, not prescriptive.

### Black-Litterman

- Start from market-cap equilibrium weights (CAPM implied returns).
- Blend user's views (e.g. "I expect TSLA to outperform by 5%") via Bayesian update.
- Output: posterior expected returns + revised weights.
- Explain conceptually; provide numeric illustration when user supplies explicit views.

### Risk Parity

- Allocate so each asset contributes equally to total portfolio volatility.
- Approximate weight ∝ 1 / volatility (simplified). For full risk parity use covariance.
- Result: typically overweights low-volatility assets (bonds, gold) vs equities.

### All-Weather (Bridgewater style)

- 4 economic quadrants: growth up/down × inflation up/down.
- Suggested weight guidance: 30% equities, 40% long bonds, 15% intermediate bonds, 7.5% gold, 7.5% commodities.
- Map user's holdings to quadrant exposure; identify gaps.

## Output template

```
Asset Allocation Analysis — Source: Longbridge Securities
Framework: <MPT / Black-Litterman / Risk Parity / All-Weather / Practical>
Date: <today>

[Current Portfolio]
Asset       Weight   Expected Return   Volatility (ann.)
<symbol>    <N>%     <N>%              <N>%
...

[Suggested Allocation — <Framework>]
Asset       Target Weight   Rationale
<symbol>    <N>%            <reason>
...

[Key Metrics]
- Portfolio expected return (ann.): N%
- Portfolio volatility (ann.): N%
- Sharpe ratio (rf=4%): N

[Caveats]
- Historical returns do not guarantee future results.
- Covariance estimates are noisy over short windows.
- <framework-specific caveats>

⚠️ 仅供参考，不构成投资建议。/ 僅供參考，不構成投資建議。/ For reference only. Not investment advice.
```

## Error handling

| Situation                         | 简体回复                                           | 繁體回復                                           | English reply                                                  |
| --------------------------------- | -------------------------------------------------- | -------------------------------------------------- | -------------------------------------------------------------- |
| `command not found: longbridge`   | 回退到 MCP；若也不可用，请安装 longbridge-terminal | 回退到 MCP；若也不可用，請安裝 longbridge-terminal | Fall back to MCP; if unavailable, install longbridge-terminal. |
| stderr `not logged in`            | 未登录时将使用用户指定的标的做示例分析             | 未登入時將使用用戶指定的標的做示例分析             | Not logged in — will analyse user-specified symbols instead.   |
| Price history < 60 days           | 数据不足，降级为简单波动率估算                     | 數據不足，降級為簡單波動率估算                     | Insufficient history; degrade to simple volatility estimate.   |
| No positions and no symbols given | 请提供要分析的标的或登录账户                       | 請提供要分析的標的或登入賬戶                       | Please provide symbols to analyse or log in to your account.   |