Alpha

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Forbes  Jun 27  Comment 
Jack Bloom of Alpha Capital Corp. answers TJ Walker's questions about Small Cap investing and his view on the future of the markets.
The Australian  Jun 24  Comment 
The fund Invests in fixed-rate commercial equipment leases and is aimed at self-managed super funds.
Mondo Visione  Jun 18  Comment 
At a basic level, electronic alpha capture is poised to become a major workflow tool for every portfolio manager and broker-dealer to prioritize data points and opinions, pushing the most relevant ideas to the surface. According to TABB Group...
Reuters  Jun 13  Comment 
* To form independent committee to value Alpha, CDS assets
Banking Business Review  Jun 9  Comment 
State Street Global Advisors (SSgA), the investment management business of State Street, has appointed Bill Street as new global head of Fixed Income Alpha Strategies.
FX Street  Jun 7  Comment 
There are new options out there called NASDAQ OMX Alpha Indexes Options. This newsletter will... For more information, read our latest forex news and reports.
NPR  Jun 2  Comment 
Shareholders of Massey Energy and Alpha Natural Resources have approved a merger that creates the world's third largest producer of high-priced and high-demand metallurgical coal. Massey became a takeover target after last year's deadly explosion...
New York Times  Jun 2  Comment 
Alpha Natural Resources’ $7.1 billion purchase of Massey Energy on Wednesday created the nation’s largest metallurgical coal company.
Wall Street Journal  Jun 1  Comment 
Alpha completed its $7.1 billion acquisition of Massey Energy, inheriting extensive reserves of high-demand coal and more than a dozen lawsuits stemming from a deadly accident last year.
Benzinga  May 31  Comment 
A group of Massey Energy (NYSE: MEE) shareholders are looking to halt the company's $7.1 billion sale to rival Alpha Natural Resources (NYSE: ANR) just a couple of days before investors are scheduled to meet to approve the deal announced in...




 
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A measure of performance on a risk-adjusted basis. Alpha takes the volatility (price risk) of a mutual fund and compares its risk-adjusted performance to a benchmark index. The excess return of the fund relative to the return of the benchmark index is a fund's alpha.

The abnormal rate of return on a security or portfolio in excess of what would be predicted by an equilibrium model like the capital asset pricing model (CAPM).

1. Alpha is one of five technical risk ratios; the others are beta, standard deviation, R-squared, and the Sharpe ratio. These are all statistical measurements used in modern portfolio theory (MPT). All of these indicators are intended to help investors determine the risk-reward profile of a mutual fund. Simply stated, alpha is often considered to represent the value that a portfolio manager adds to or subtracts from a fund's return. A positive alpha of 1.0 means the fund has outperformed its benchmark index by 1%. Correspondingly, a similar negative alpha would indicate an underperformance of 1%.

2. If a CAPM analysis estimates that a portfolio should earn 10% based on the risk of the portfolio but the portfolio actually earns 15%, the portfolio's alpha would be 5%. This 5% is the excess return over what was predicted in the CAPM model.

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