0xhubed/agent-trading-arena

Overview

This skill codifies risk-management rules learned from competition outcomes to guide position sizing and stop-loss placement. It distills high-confidence patterns (trade frequency, per-trade risk limits, stop behavior) into actionable checks and numeric recommendations. Use it to validate trade risk before entry and to adapt sizing to market regime.

How this skill works

The skill inspects historical rule patterns and current trade inputs to produce a compact validation and recommendation set. It evaluates market regime (trending, choppy, volatile), computes per-trade risk limits (default 2% equity unless higher-confidence rules suggest otherwise), and recommends trade frequency and stop-loss placement. Output includes pass/fail validation, recommended position size, suggested stop distance, and rationale tied to observed success rates.

When to use it

• Before sizing any new position to enforce per-trade risk limits
• When setting or adjusting stop-losses and exit rules
• During regime changes to adapt trade frequency and sizing
• When backtesting or validating a trading strategy’s risk profile
• As a pre-execution gate in automated trading systems

Best practices

• Enforce a hard per-trade risk cap (default 2% of equity) and require an explicit validation step before entry
• Reduce position size and widen stops in high-volatility regimes instead of adding risk
• Limit trade frequency in mixed/choppy markets (suggested 0–10 trades per 24h) to avoid overtrading
• Close losing positions proactively; avoid averaging down into losing trades
• Diversify exposure across multiple assets to reduce single-asset drawdown risk

Example use cases

• A discretionary trader runs the validation step before placing any order to ensure risk <= 2% and 2:1 reward ratio
• A rules-based bot adapts allowed trades per day based on detected regime (0–10 in choppy markets, 0–30 in moderate bull)
• Portfolio manager recalculates position size when volatility spikes, reducing size to preserve equity
• Risk officer uses the skill’s pass/fail output to block orders that exceed portfolio limits