Adviser — Portfolio Concentration and Stress Testing

Concentration analysis

Map economic connections across counterparties, commodities, regions, storage providers, buyers and financing structures. Examine where collateral values and borrower performance may deteriorate at the same time. Challenge diversification claims based only on legal-entity counts or sector labels.

Stress design and interpretation

Develop scenarios that combine plausible shocks, including price changes, delayed settlement, logistics interruption and reduced collateral realisability. Explain assumptions, data limitations and sensitivity rather than presenting a single precise loss number. Identify the actions management could take and whether those actions remain available under the stressed conditions.

Stress results should identify the mechanism producing the loss or liquidity need, not only a percentage reduction in portfolio value. Test assumptions about collection timing, collateral discounts and the ability to reduce exposure during the event. The adviser should also examine reverse scenarios: what combination of changes would exhaust a chosen tolerance, and is that combination credible? Recommendations should make clear where better data would materially change the conclusion and where uncertainty should instead be managed through more conservative limits or stronger controls.

Candidate qualifications

Candidates should have portfolio-risk, commodity-finance or stress-testing experience with strong analytical capability. They need judgement about economic relationships and the ability to communicate model limitations. Experience connecting stress results to actual limit or capital decisions is especially relevant.

Deliverables and acceptance

Provide a concentration map, documented scenarios and recommendations for monitoring and escalation. The framework should be maintainable with available data and clearly distinguish estimates from known exposures. Candidates should explain how they would challenge a reassuring stress result that assumes all collateral can be sold quickly without affecting price. The assignment provides analysis and advice, not a guarantee of portfolio resilience.