Asset Allocation & Risk
What is alpha (α) in fund performance?
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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 14/10/2026, not investment advice. Rules and tax rates change, so please also check the latest guidance from the source institution.