What does alpha mean
Mathematics
ScanSolve AI Answer
Answer
In finance, alpha (α) is a measure of an investment's performance relative to a benchmark index.
It represents the excess return an investment generates compared to what would be expected given its risk (beta). A positive alpha indicates the investment has outperformed its benchmark, while a negative alpha means it has underperformed. It's often seen as a measure of the fund manager's skill.
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