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Glossary

Alpha

A measure for the differing performance of an investment.

"Alpha" represents the performance of an investment compared to a reference investment, the benchmark. A positive alpha signals a higher performance, and a negative alpha represents a underperformance. Regarding funds, the performance is usually compared to an index which tracks the overall market. In this case, a positive alpha equals a successful fund management compared to an investment in the reference market, due to the selection of individual securities.

Related topics
Benchmark

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