Risk Management Tool
Free to download on every platform. Comes pre-installed on BotFone, BotPad and BotFlip — with extra free apps included.
About this app
WHAT IT DOES
Risk Management Tool helps you analyze the risk profile of your crypto portfolio. You provide your holdings (asset, amount, and annual volatility estimate), and the tool calculates key risk metrics including portfolio volatility, Value at Risk (VaR) at 95% and 99% confidence levels, Sharpe ratio, and risk contribution per asset. It displays a risk assessment (low/moderate/high), visualizes risk contributions, and provides actionable recommendations. This is essential for investors who want to understand and manage their portfolio risk, set risk limits, and make informed allocation decisions. It reads the current network chain ID from your wallet provider for context, but all calculations are performed locally.
HOW TO USE
Connect your wallet using the "Connect" button (required for network context). Select the target network (Ethereum Mainnet, Sepolia, Polygon, BSC, Arbitrum, Optimism, and testnets are supported). Enter your portfolio holdings with asset symbol, amount, and annual volatility estimate (%). Enter current market prices for each asset. Optionally set the risk-free rate for Sharpe ratio calculation. Click "Analyze risk" — the tool will calculate portfolio value, volatility, VaR, Sharpe ratio, and risk contribution. The entire operation is read-only — no transactions are signed or sent.
TECHNICAL MECHANISM
The tool calculates portfolio value by multiplying each asset's amount by its current price. Portfolio volatility is estimated as the weighted sum of individual asset volatilities (simplified, assuming no correlation). VaR is calculated as portfolioValue * volatility * z-score (1.645 for 95%, 2.326 for 99%). Sharpe ratio is (expected return - risk-free rate) / portfolio volatility. Risk contribution per asset is calculated as (weight * volatility) / portfolio volatility. The tool uses ethers.js v5.7.2 for network context but performs all calculations locally. Results are displayed with color-coded indicators and recommendations.
WHAT IT CANNOT SEE
The tool cannot guarantee that risk metrics will accurately predict future losses or performance. It cannot account for black swan events or extreme market conditions. It is limited by RPC provider availability and price feed freshness. It cannot read external portfolio data or automatically estimate volatility without historical data. It cannot account for correlation between assets (simplified model). It cannot consider liquidity risk or counterparty risk.
PLEASE NOTE
This tool is for educational and analytical purposes. Risk metrics do not guarantee future performance. The tool does not persist any data; all state is lost on page reload. EVM chains only.
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