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Alpha

Alpha is the part of a portfolio's return that its exposure to the market does not explain. If beta says how much a portfolio should have risen given what the index did, alpha is how much it rose above or below that expectation. It is the standard measure of whether active management adds anything, and also the easiest to confuse with luck: over short periods, positive alpha is rarely distinguishable from chance.

Formula

Alfa = rentabilidad real − rentabilidad esperada según beta

See it on real data

Celsmar computes this from the accounts companies file with their regulator, and shows which line every figure comes from. Free to start, no card.

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Definition for informational purposes. It is not financial advice nor a recommendation to buy or sell.