Alpha and Excess Return: Not Synonymous
Can a fund whose alpha is positive significantly underperform the market? Yes, it can. This is a common question we receive during our clients’ Quarterly reporting, so we felt it worth addressing this phenomena – and taking a quick look at funds that gain this distinction. There is a common misconception that alpha means outperformance […]
Can a fund whose alpha is positive significantly underperform the market? Yes, it can.
This is a common question we receive during our clients’ Quarterly reporting, so we felt it worth addressing this phenomena – and taking a quick look at funds that gain this distinction.
There is a common misconception that alpha means outperformance or “beating the market”.
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