Asset Allocation & Risk
What is alpha (α) in fund performance?
Alpha measures active performance, i.e., the return achieved above an appropriate benchmark index.
For example, an alpha of 1% means the investment returned 1 percentage point more than the beta-adjusted market return over the same period, and a negative alpha means it returned less. A fund that charges fees must generate alpha greater than its fees to outperform an index fund.
This answer is general financial information as of 2026.10.14, not investment advice. Rules and tax rates change, so please also check the latest guidance from the source institution.