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	<h1 id="firstHeading" class="firstHeading" lang="en">Alpha (finance)</h1>
	
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<table class="box-More_citations_needed plainlinks metadata ambox ambox-content ambox-Refimprove" role="presentation"><tbody><tr><td class="mbox-image"><div style="width:52px"><a href="/wiki/File:Question_book-new.svg" class="image"><img alt="" src="//upload.wikimedia.org/wikipedia/en/thumb/9/99/Question_book-new.svg/50px-Question_book-new.svg.png" decoding="async" width="50" height="39" srcset="//upload.wikimedia.org/wikipedia/en/thumb/9/99/Question_book-new.svg/75px-Question_book-new.svg.png 1.5x, //upload.wikimedia.org/wikipedia/en/thumb/9/99/Question_book-new.svg/100px-Question_book-new.svg.png 2x" data-file-width="512" data-file-height="399" /></a></div></td><td class="mbox-text"><div class="mbox-text-span">This article <b>needs additional citations for <a href="/wiki/Wikipedia:Verifiability" title="Wikipedia:Verifiability">verification</a></b>.<span class="hide-when-compact"> Please help <a class="external text" href="https://en.wikipedia.org/w/index.php?title=Alpha_(finance)&action=edit">improve this article</a> by <a href="/wiki/Help:Introduction_to_referencing_with_Wiki_Markup/1" title="Help:Introduction to referencing with Wiki Markup/1">adding citations to reliable sources</a>. Unsourced material may be challenged and removed.<br /><small><span class="plainlinks"><i>Find sources:</i> <a rel="nofollow" class="external text" href="//www.google.com/search?as_eq=wikipedia&q=%22Alpha%22+finance">"Alpha" finance</a> – <a rel="nofollow" class="external text" href="//www.google.com/search?tbm=nws&q=%22Alpha%22+finance+-wikipedia">news</a> <b>·</b> <a rel="nofollow" class="external text" href="//www.google.com/search?&q=%22Alpha%22+finance+site:news.google.com/newspapers&source=newspapers">newspapers</a> <b>·</b> <a rel="nofollow" class="external text" href="//www.google.com/search?tbs=bks:1&q=%22Alpha%22+finance+-wikipedia">books</a> <b>·</b> <a rel="nofollow" class="external text" href="//scholar.google.com/scholar?q=%22Alpha%22+finance">scholar</a> <b>·</b> <a rel="nofollow" class="external text" href="https://www.jstor.org/action/doBasicSearch?Query=%22Alpha%22+finance&acc=on&wc=on">JSTOR</a></span></small></span>  <small class="date-container"><i>(<span class="date">March 2016</span>)</i></small><small class="hide-when-compact"><i> (<a href="/wiki/Help:Maintenance_template_removal" title="Help:Maintenance template removal">Learn how and when to remove this template message</a>)</i></small></div></td></tr></tbody></table>
<p><b>Alpha</b> is a measure of the <a href="/wiki/Active_return" title="Active return">active return</a> on an <a href="/wiki/Investment" title="Investment">investment</a>, the performance of that investment compared with a suitable <a href="/wiki/Stock_market_index" title="Stock market index">market index</a>. An alpha of 1% means the investment's <a href="/wiki/Return_on_investment" title="Return on investment">return on investment</a> over a selected period of time was 1% better than the market during that same period; a negative alpha means the investment underperformed the market. Alpha, along with <a href="/wiki/Beta_(finance)" title="Beta (finance)">beta</a>, is one of two key coefficients in the <a href="/wiki/Capital_asset_pricing_model" title="Capital asset pricing model">capital asset pricing model</a> used in <a href="/wiki/Modern_portfolio_theory" title="Modern portfolio theory">modern portfolio theory</a> and is closely related to other important quantities such as <a href="/wiki/Standard_deviation#Finance" title="Standard deviation">standard deviation</a>, <a href="/wiki/R-squared" class="mw-redirect" title="R-squared">R-squared</a> and the <a href="/wiki/Sharpe_ratio#Use_in_finance" title="Sharpe ratio">Sharpe ratio</a>.<sup id="cite_ref-1" class="reference"><a href="#cite_note-1">[1]</a></sup>
</p><p>In modern financial markets, where <a href="/wiki/Index_fund" title="Index fund">index funds</a> are widely available for purchase, alpha is commonly used to judge the performance of <a href="/wiki/Mutual_fund" title="Mutual fund">mutual funds</a> and similar investments. As these funds include various fees normally expressed in percent terms, the fund has to maintain an alpha greater than its fees in order to provide positive gains compared with an index fund. Historically, the vast majority of traditional funds have had negative alphas, which has led to a <a href="/wiki/Flight_of_capital" class="mw-redirect" title="Flight of capital">flight of capital</a> to index funds and non-traditional <a href="/wiki/Hedge_fund" title="Hedge fund">hedge funds</a>.
</p><p>It is also possible to analyze a portfolio of investments and calculate a theoretical performance, most commonly using the <a href="/wiki/Capital_asset_pricing_model" title="Capital asset pricing model">capital asset pricing model</a> (CAPM). Returns on that portfolio can be compared with the theoretical returns, in which case the measure is known as <a href="/wiki/Jensen%27s_alpha" title="Jensen's alpha">Jensen's alpha</a>. This is useful for non-traditional or highly focused funds, where a single stock index might not be representative of the investment's holdings.
</p>
<div id="toc" class="toc" role="navigation" aria-labelledby="mw-toc-heading"><input type="checkbox" role="button" id="toctogglecheckbox" class="toctogglecheckbox" style="display:none" /><div class="toctitle" lang="en" dir="ltr"><h2 id="mw-toc-heading">Contents</h2><span class="toctogglespan"><label class="toctogglelabel" for="toctogglecheckbox"></label></span></div>
<ul>
<li class="toclevel-1 tocsection-1"><a href="#Definition_in_CAPM"><span class="tocnumber">1</span> <span class="toctext">Definition in CAPM</span></a></li>
<li class="toclevel-1 tocsection-2"><a href="#Origin_of_the_concept"><span class="tocnumber">2</span> <span class="toctext">Origin of the concept</span></a></li>
<li class="toclevel-1 tocsection-3"><a href="#Relation_to_beta"><span class="tocnumber">3</span> <span class="toctext">Relation to beta</span></a></li>
<li class="toclevel-1 tocsection-4"><a href="#References"><span class="tocnumber">4</span> <span class="toctext">References</span></a></li>
<li class="toclevel-1 tocsection-5"><a href="#Further_reading"><span class="tocnumber">5</span> <span class="toctext">Further reading</span></a></li>
<li class="toclevel-1 tocsection-6"><a href="#External_links"><span class="tocnumber">6</span> <span class="toctext">External links</span></a></li>
</ul>
</div>

<h2><span class="mw-headline" id="Definition_in_CAPM">Definition in CAPM</span><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Alpha_(finance)&action=edit&section=1" title="Edit section: Definition in CAPM">edit</a><span class="mw-editsection-bracket">]</span></span></h2>
<p>The <b>alpha coefficient</b> (<span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle \alpha _{i}}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>α<!-- α --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle \alpha _{i}}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/3b1fb627423abe4988b7ed88d4920bf1ec074790" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:2.287ex; height:2.009ex;" alt="\alpha _{i}"/></span>) is a parameter in the <a href="/wiki/Single-index_model" title="Single-index model">single-index model</a> (SIM). It is the <a href="/wiki/Root_of_a_function" class="mw-redirect" title="Root of a function">intercept</a> of the <a href="/wiki/Security_characteristic_line" title="Security characteristic line">security characteristic line</a> (SCL), that is, the coefficient of the constant in a market model regression.
</p>
<dl><dd><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle \mathrm {SCL} :R_{i,t}-R_{f}=\alpha _{i}+\beta _{i}\,(R_{M,t}-R_{f})+\varepsilon _{i,t}}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <mrow class="MJX-TeXAtom-ORD">
          <mi mathvariant="normal">S</mi>
          <mi mathvariant="normal">C</mi>
          <mi mathvariant="normal">L</mi>
        </mrow>
        <mo>:</mo>
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
            <mo>,</mo>
            <mi>t</mi>
          </mrow>
        </msub>
        <mo>−<!-- − --></mo>
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>f</mi>
          </mrow>
        </msub>
        <mo>=</mo>
        <msub>
          <mi>α<!-- α --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
        <mo>+</mo>
        <msub>
          <mi>β<!-- β --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
        <mspace width="thinmathspace" />
        <mo stretchy="false">(</mo>
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>M</mi>
            <mo>,</mo>
            <mi>t</mi>
          </mrow>
        </msub>
        <mo>−<!-- − --></mo>
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>f</mi>
          </mrow>
        </msub>
        <mo stretchy="false">)</mo>
        <mo>+</mo>
        <msub>
          <mi>ε<!-- ε --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
            <mo>,</mo>
            <mi>t</mi>
          </mrow>
        </msub>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle \mathrm {SCL} :R_{i,t}-R_{f}=\alpha _{i}+\beta _{i}\,(R_{M,t}-R_{f})+\varepsilon _{i,t}}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/5b7e3c08d67e23a5045bb2e3b1f39a218e869d0a" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -1.005ex; width:44.544ex; height:3.009ex;" alt="{\displaystyle \mathrm {SCL} :R_{i,t}-R_{f}=\alpha _{i}+\beta _{i}\,(R_{M,t}-R_{f})+\varepsilon _{i,t}}"/></span></dd></dl>
<p>where the following inputs are:
</p>
<ul><li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle R_{i}}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle R_{i}}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/db421291be9d0103404ced7495b363437b67b6b1" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:2.564ex; height:2.509ex;" alt="R_{i}"/></span>: the <a href="/wiki/Market_portfolio" title="Market portfolio">realized return</a> (on the portfolio),</li>
<li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle R_{M}}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>M</mi>
          </mrow>
        </msub>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle R_{M}}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/e1a600516077fb78afb09d1aa981513e4d60dc16" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:3.723ex; height:2.509ex;" alt="R_M"/></span>: the <a href="/wiki/Market_portfolio" title="Market portfolio">market return</a>,</li>
<li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle R_{f}}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>R</mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>f</mi>
          </mrow>
        </msub>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle R_{f}}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/eabfb117bfefaaad341b75ad3966e68c90469967" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -1.005ex; width:2.9ex; height:2.843ex;" alt="R_{f}"/></span>: the <a href="/wiki/Risk-free_rate" class="mw-redirect" title="Risk-free rate">risk-free rate</a> of return, and</li>
<li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle \beta _{iM}}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>β<!-- β --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
            <mi>M</mi>
          </mrow>
        </msub>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle \beta _{iM}}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/243399291389d5fa44f4535c7b228e907052a1b8" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:3.842ex; height:2.509ex;" alt="{\displaystyle \beta _{iM}}"/></span>: the <a href="/wiki/Beta_coefficient" class="mw-redirect" title="Beta coefficient">beta</a> of the portfolio.</li></ul>
<p>It can be shown that in an <a href="/wiki/Efficient-market_hypothesis" title="Efficient-market hypothesis">efficient market</a>, the expected value of the alpha coefficient is zero. Therefore, the alpha coefficient indicates how an investment has performed after accounting for the risk it involved:
</p>
<ul><li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle \alpha _{i}<0}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>α<!-- α --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
        <mo><</mo>
        <mn>0</mn>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle \alpha _{i}<0}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/454bb10b108da2707c3c4927d6c2f5e30b4871cb" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:6.548ex; height:2.509ex;" alt="\alpha _{i}<0"/></span>: the investment has earned too little for its risk (or, was too risky for the return)</li>
<li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle \alpha _{i}=0}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>α<!-- α --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
        <mo>=</mo>
        <mn>0</mn>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle \alpha _{i}=0}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/08ba50c835a3936422636b8d394aed2d95356656" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:6.548ex; height:2.509ex;" alt="\alpha _{i}=0"/></span>: the investment has earned a return adequate for the risk taken</li>
<li><span class="mwe-math-element"><span class="mwe-math-mathml-inline mwe-math-mathml-a11y" style="display: none;"><math xmlns="http://www.w3.org/1998/Math/MathML"  alttext="{\displaystyle \alpha _{i}>0}">
  <semantics>
    <mrow class="MJX-TeXAtom-ORD">
      <mstyle displaystyle="true" scriptlevel="0">
        <msub>
          <mi>α<!-- α --></mi>
          <mrow class="MJX-TeXAtom-ORD">
            <mi>i</mi>
          </mrow>
        </msub>
        <mo>></mo>
        <mn>0</mn>
      </mstyle>
    </mrow>
    <annotation encoding="application/x-tex">{\displaystyle \alpha _{i}>0}</annotation>
  </semantics>
</math></span><img src="https://wikimedia.org/api/rest_v1/media/math/render/svg/8ca574e2543100c77034d89176082da023382a75" class="mwe-math-fallback-image-inline" aria-hidden="true" style="vertical-align: -0.671ex; width:6.548ex; height:2.509ex;" alt="\alpha _{i}>0"/></span>: the investment has a return in excess of the reward for the assumed risk</li></ul>
<p>For instance, although a return of 20% may appear good, the investment can still have a negative alpha if it's involved in an excessively risky position.
</p><p>In this context, because returns are being compared with the theoretical return of CAPM and not to a market index, it would be more accurate to use the term of <a href="/wiki/Jensen%27s_alpha" title="Jensen's alpha">Jensen's alpha</a>.
</p>
<h2><span class="mw-headline" id="Origin_of_the_concept">Origin of the concept</span><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Alpha_(finance)&action=edit&section=2" title="Edit section: Origin of the concept">edit</a><span class="mw-editsection-bracket">]</span></span></h2>
<p>A belief in efficient markets spawned the creation of market capitalization weighted index funds that seek to replicate the performance of investing in an entire market in the weights that each of the equity securities comprises in the overall market.<sup class="noprint Inline-Template Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citation_needed" title="Wikipedia:Citation needed"><span title="This claim needs references to reliable sources. (March 2008)">citation needed</span></a></i>]</sup>  The best examples for the US are the <a href="/wiki/S%26P_500" class="mw-redirect" title="S&P 500">S&P 500</a> and the <a href="/wiki/Wilshire_5000" title="Wilshire 5000">Wilshire 5000</a> which approximately represent the 500 most widely held equities and the largest 5000 securities respectively, accounting for approximately 80%+ and 99%+ of the total market capitalization of the US market as a whole.
</p><p>In fact, to many investors,<sup class="noprint Inline-Template Template-Fact" style="white-space:nowrap;">[<i><a href="/wiki/Wikipedia:Citation_needed" title="Wikipedia:Citation needed"><span title="This claim needs references to reliable sources. (March 2008)">citation needed</span></a></i>]</sup> this phenomenon created a new standard of performance that must be matched: an investment manager should not only avoid losing money for the client and should  make a certain amount of money, but in fact should make more money than the passive strategy of investing in everything equally (since this strategy appeared to be statistically more likely to be successful than the strategy of any one investment manager).  The name for the additional return above the <a href="/wiki/Expected_return" title="Expected return">expected return</a> of the beta adjusted return of the market is called "Alpha".
</p>
<h2><span class="mw-headline" id="Relation_to_beta">Relation to beta</span><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Alpha_(finance)&action=edit&section=3" title="Edit section: Relation to beta">edit</a><span class="mw-editsection-bracket">]</span></span></h2>
<div role="note" class="hatnote navigation-not-searchable">Main article: <a href="/wiki/Beta_(finance)" title="Beta (finance)">Beta (finance)</a></div>
<p>Besides an investment manager simply making more money than a passive strategy, there is another issue:
although the strategy of investing in every stock appeared to perform better than 75 percent of investment managers (see <a href="/wiki/Index_fund" title="Index fund">index fund</a>), the price of the stock market as a whole <a href="/wiki/Volatility_(finance)" title="Volatility (finance)">fluctuates</a> up and down, and could be on a downward decline for many years before returning to its previous price.
</p><p>The passive strategy appeared to generate the market-beating return over periods of 10 years or more. This strategy may be risky for those who feel they might need to withdraw their money before a 10-year holding period, for example. Thus investment managers who employ a strategy which is less likely to lose money in a particular year are often chosen by those investors who feel that they might need to withdraw their money sooner.
</p><p>Investors can use both alpha and beta to judge a manager's performance. If the manager has had a high alpha, but also a high beta, investors might not find that acceptable, because of the chance they might have to withdraw their money when the investment is doing poorly.
</p><p>These concepts not only apply to investment managers, but to any kind of investment.
</p>
<h2><span class="mw-headline" id="References">References</span><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Alpha_(finance)&action=edit&section=4" title="Edit section: References">edit</a><span class="mw-editsection-bracket">]</span></span></h2>
<div class="reflist" style="list-style-type: decimal;">
<div class="mw-references-wrap"><ol class="references">
<li id="cite_note-1"><span class="mw-cite-backlink"><b><a href="#cite_ref-1">^</a></b></span> <span class="reference-text">* Loth, Richard, "<a rel="nofollow" class="external text" href="http://www.investopedia.com/articles/mutualfund/112002.asp">5 Ways To Measure Mutual Fund Risk</a>" <i>Investopedia</i></span>
</li>
</ol></div></div>
<h2><span class="mw-headline" id="Further_reading">Further reading</span><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Alpha_(finance)&action=edit&section=5" title="Edit section: Further reading">edit</a><span class="mw-editsection-bracket">]</span></span></h2>
<ul><li>Bruce J. Feibel. <i>Investment Performance Measurement</i>. New York: Wiley, 2003. <style data-mw-deduplicate="TemplateStyles:r935243608">.mw-parser-output cite.citation{font-style:inherit}.mw-parser-output .citation q{quotes:"\"""\"""'""'"}.mw-parser-output .id-lock-free a,.mw-parser-output .citation .cs1-lock-free a{background:url("//upload.wikimedia.org/wikipedia/commons/thumb/6/65/Lock-green.svg/9px-Lock-green.svg.png")no-repeat;background-position:right .1em center}.mw-parser-output .id-lock-limited a,.mw-parser-output .id-lock-registration a,.mw-parser-output .citation .cs1-lock-limited a,.mw-parser-output .citation .cs1-lock-registration a{background:url("//upload.wikimedia.org/wikipedia/commons/thumb/d/d6/Lock-gray-alt-2.svg/9px-Lock-gray-alt-2.svg.png")no-repeat;background-position:right .1em center}.mw-parser-output .id-lock-subscription a,.mw-parser-output .citation .cs1-lock-subscription a{background:url("//upload.wikimedia.org/wikipedia/commons/thumb/a/aa/Lock-red-alt-2.svg/9px-Lock-red-alt-2.svg.png")no-repeat;background-position:right .1em center}.mw-parser-output .cs1-subscription,.mw-parser-output .cs1-registration{color:#555}.mw-parser-output .cs1-subscription span,.mw-parser-output .cs1-registration span{border-bottom:1px dotted;cursor:help}.mw-parser-output .cs1-ws-icon a{background:url("//upload.wikimedia.org/wikipedia/commons/thumb/4/4c/Wikisource-logo.svg/12px-Wikisource-logo.svg.png")no-repeat;background-position:right .1em center}.mw-parser-output code.cs1-code{color:inherit;background:inherit;border:inherit;padding:inherit}.mw-parser-output .cs1-hidden-error{display:none;font-size:100%}.mw-parser-output .cs1-visible-error{font-size:100%}.mw-parser-output .cs1-maint{display:none;color:#33aa33;margin-left:0.3em}.mw-parser-output .cs1-subscription,.mw-parser-output .cs1-registration,.mw-parser-output .cs1-format{font-size:95%}.mw-parser-output .cs1-kern-left,.mw-parser-output .cs1-kern-wl-left{padding-left:0.2em}.mw-parser-output .cs1-kern-right,.mw-parser-output .cs1-kern-wl-right{padding-right:0.2em}</style><a href="/wiki/International_Standard_Book_Number" title="International Standard Book Number">ISBN</a> <a href="/wiki/Special:BookSources/0-471-26849-6" title="Special:BookSources/0-471-26849-6">0-471-26849-6</a></li></ul>
<h2><span class="mw-headline" id="External_links">External links</span><span class="mw-editsection"><span class="mw-editsection-bracket">[</span><a href="/w/index.php?title=Alpha_(finance)&action=edit&section=6" title="Edit section: External links">edit</a><span class="mw-editsection-bracket">]</span></span></h2>
<ul><li><a rel="nofollow" class="external text" href="http://www.businessvaluation.us">International Association of CPAs, Attorneys, and Management (IACAM) (Free Business Valuation E-Book Guidebook)</a></li>
<li><a rel="nofollow" class="external text" href="http://financial-dictionary.thefreedictionary.com/Alpha">The financial-dictionary entry on alpha</a></li>
<li><a rel="nofollow" class="external text" href="http://www.investopedia.com/terms/a/alpha.asp">Investopedia Alpha Definition</a></li>
<li><a rel="nofollow" class="external text" href="https://web.archive.org/web/20111112055425/http://www.forexbasecamp.com/advanced-forex-concepts/five-technical-risk-ratios-in-forex-trading">Five Technical Risk Ratios</a></li>
<li><a rel="nofollow" class="external text" href="http://www.macroaxis.com/invest/alphaSearch/GOOG">Alpha analysis for global equities</a> Free alpha look-up</li>
<li><a rel="nofollow" class="external text" href="http://www.tradersmagazine.com/issues/26_353/hedge-fund-lake-hill-creates-value-trading-index-options-111339-1.html">Traders Magazine</a> Seeking Alpha - New York hedge fund creates value trading index options</li></ul>
<div role="navigation" class="navbox" aria-labelledby="Financial_markets" style="padding:3px"><table class="nowraplinks hlist mw-collapsible autocollapse navbox-inner" style="border-spacing:0;background:transparent;color:inherit"><tbody><tr><th scope="col" class="navbox-title" colspan="2"><div class="plainlinks hlist navbar mini"><ul><li class="nv-view"><a href="/wiki/Template:Financial_markets_navigation" title="Template:Financial markets navigation"><abbr title="View this template" style=";;background:none transparent;border:none;-moz-box-shadow:none;-webkit-box-shadow:none;box-shadow:none; padding:0;">v</abbr></a></li><li class="nv-talk"><a href="/wiki/Template_talk:Financial_markets_navigation" title="Template talk:Financial markets navigation"><abbr title="Discuss this template" style=";;background:none transparent;border:none;-moz-box-shadow:none;-webkit-box-shadow:none;box-shadow:none; padding:0;">t</abbr></a></li><li class="nv-edit"><a class="external text" href="https://en.wikipedia.org/w/index.php?title=Template:Financial_markets_navigation&action=edit"><abbr title="Edit this template" style=";;background:none transparent;border:none;-moz-box-shadow:none;-webkit-box-shadow:none;box-shadow:none; padding:0;">e</abbr></a></li></ul></div><div id="Financial_markets" style="font-size:114%;margin:0 4em"><a href="/wiki/Financial_market" title="Financial market">Financial markets</a></div></th></tr><tr><th scope="row" class="navbox-group" style="width:1%">Types of <a href="/wiki/Capital_market" title="Capital market">markets</a></th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Primary_market" title="Primary market">Primary market</a></li>
<li><a href="/wiki/Secondary_market" title="Secondary market">Secondary market</a></li>
<li><a href="/wiki/Third_market" title="Third market">Third market</a></li>
<li><a href="/wiki/Fourth_market" title="Fourth market">Fourth market</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Types of <a href="/wiki/Stock" title="Stock">stocks</a></th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Common_stock" title="Common stock">Common stock</a></li>
<li><a href="/wiki/Golden_share" title="Golden share">Golden share</a></li>
<li><a href="/wiki/Preferred_stock" title="Preferred stock">Preferred stock</a></li>
<li><a href="/wiki/Restricted_stock" title="Restricted stock">Restricted stock</a></li>
<li><a href="/wiki/Tracking_stock" title="Tracking stock">Tracking stock</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%"><a href="/wiki/Share_capital" title="Share capital">Share capital</a></th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Authorised_capital" title="Authorised capital">Authorised capital</a></li>
<li><a href="/wiki/Issued_shares" title="Issued shares">Issued shares</a></li>
<li><a href="/wiki/Shares_outstanding" title="Shares outstanding">Shares outstanding</a></li>
<li><a href="/wiki/Treasury_stock" title="Treasury stock">Treasury stock</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Participants</th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Broker-dealer" title="Broker-dealer">Broker-dealer</a></li>
<li><a href="/wiki/Day_trader" class="mw-redirect" title="Day trader">Day trader</a></li>
<li><a href="/wiki/Floor_broker" title="Floor broker">Floor broker</a></li>
<li><a href="/wiki/Floor_trader" title="Floor trader">Floor trader</a></li>
<li><a href="/wiki/Investor" title="Investor">Investor</a></li>
<li><a href="/wiki/Market_maker" title="Market maker">Market maker</a></li>
<li><a href="/wiki/Proprietary_trading" title="Proprietary trading">Proprietary trader</a></li>
<li><a href="/wiki/Quantitative_analyst" class="mw-redirect" title="Quantitative analyst">Quantitative analyst</a></li>
<li><a href="/wiki/Financial_law" title="Financial law">Financial law</a></li>
<li><a href="/wiki/Financial_regulation" title="Financial regulation">Regulator</a></li>
<li><a href="/wiki/Stock_trader" title="Stock trader">Stock trader</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%"><a href="/wiki/Stock_exchange" title="Stock exchange">Exchanges</a></th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Electronic_communication_network" title="Electronic communication network">Electronic communication network</a></li>
<li><a href="/wiki/List_of_stock_exchanges" title="List of stock exchanges">List of stock exchanges</a>
<ul><li><a href="/wiki/List_of_stock_exchange_trading_hours" title="List of stock exchange trading hours">Trading hours</a></li></ul></li>
<li><a href="/wiki/Multilateral_trading_facility" title="Multilateral trading facility">Multilateral trading facility</a></li>
<li><a href="/wiki/Over-the-counter_(finance)" title="Over-the-counter (finance)">Over-the-counter</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%"><a href="/wiki/Stock_valuation" title="Stock valuation">Stock valuation</a></th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a class="mw-selflink selflink">Alpha</a></li>
<li><a href="/wiki/Arbitrage_pricing_theory" title="Arbitrage pricing theory">Arbitrage pricing theory</a></li>
<li><a href="/wiki/Beta_(finance)" title="Beta (finance)">Beta</a></li>
<li><a href="/wiki/Bid%E2%80%93ask_spread" title="Bid–ask spread">Bid–ask spread</a></li>
<li><a href="/wiki/Book_value" title="Book value">Book value</a></li>
<li><a href="/wiki/Capital_asset_pricing_model" title="Capital asset pricing model">Capital asset pricing model</a></li>
<li><a href="/wiki/Capital_market_line" title="Capital market line">Capital market line</a></li>
<li><a href="/wiki/Dividend_discount_model" title="Dividend discount model">Dividend discount model</a></li>
<li><a href="/wiki/Dividend_yield" title="Dividend yield">Dividend yield</a></li>
<li><a href="/wiki/Earnings_per_share" title="Earnings per share">Earnings per share</a></li>
<li><a href="/wiki/Earnings_yield" title="Earnings yield">Earnings yield</a></li>
<li><a href="/wiki/Net_asset_value" title="Net asset value">Net asset value</a></li>
<li><a href="/wiki/Security_characteristic_line" title="Security characteristic line">Security characteristic line</a></li>
<li><a href="/wiki/Security_market_line" title="Security market line">Security market line</a></li>
<li><a href="/wiki/T-model" title="T-model">T-model</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Trading theories<br /> and <a href="/wiki/Trading_strategy" title="Trading strategy">strategies</a></th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Algorithmic_trading" title="Algorithmic trading">Algorithmic trading</a></li>
<li><a href="/wiki/Buy_and_hold" title="Buy and hold">Buy and hold</a></li>
<li><a href="/wiki/Contrarian_investing" title="Contrarian investing">Contrarian investing</a></li>
<li><a href="/wiki/Day_trading" title="Day trading">Day trading</a></li>
<li><a href="/wiki/Dollar_cost_averaging" title="Dollar cost averaging">Dollar cost averaging</a></li>
<li><a href="/wiki/Efficient-market_hypothesis" title="Efficient-market hypothesis">Efficient-market hypothesis</a></li>
<li><a href="/wiki/Fundamental_analysis" title="Fundamental analysis">Fundamental analysis</a></li>
<li><a href="/wiki/Growth_stock" title="Growth stock">Growth stock</a></li>
<li><a href="/wiki/Market_timing" title="Market timing">Market timing</a></li>
<li><a href="/wiki/Modern_portfolio_theory" title="Modern portfolio theory">Modern portfolio theory</a></li>
<li><a href="/wiki/Momentum_investing" title="Momentum investing">Momentum investing</a></li>
<li><a href="/wiki/Mosaic_theory_(investments)" title="Mosaic theory (investments)">Mosaic theory</a></li>
<li><a href="/wiki/Pairs_trade" title="Pairs trade">Pairs trade</a></li>
<li><a href="/wiki/Post-modern_portfolio_theory" title="Post-modern portfolio theory">Post-modern portfolio theory</a></li>
<li><a href="/wiki/Random_walk_hypothesis" title="Random walk hypothesis">Random walk hypothesis</a></li>
<li><a href="/wiki/Sector_rotation" title="Sector rotation">Sector rotation</a></li>
<li><a href="/wiki/Style_investing" title="Style investing">Style investing</a></li>
<li><a href="/wiki/Swing_trading" title="Swing trading">Swing trading</a></li>
<li><a href="/wiki/Technical_analysis" title="Technical analysis">Technical analysis</a></li>
<li><a href="/wiki/Trend_following" title="Trend following">Trend following</a></li>
<li><a href="/wiki/Value_averaging" title="Value averaging">Value averaging</a></li>
<li><a href="/wiki/Value_investing" title="Value investing">Value investing</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Related terms</th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Block_trade" title="Block trade">Block trade</a></li>
<li><a href="/wiki/Cross_listing" title="Cross listing">Cross listing</a></li>
<li><a href="/wiki/Dark_pool" title="Dark pool">Dark pool</a></li>
<li><a href="/wiki/Dividend" title="Dividend">Dividend</a></li>
<li><a href="/wiki/Dual-listed_company" title="Dual-listed company">Dual-listed company</a></li>
<li><a href="/wiki/DuPont_analysis" title="DuPont analysis">DuPont analysis</a></li>
<li><a href="/wiki/Efficient_frontier" title="Efficient frontier">Efficient frontier</a></li>
<li><a href="/wiki/Flight-to-quality" title="Flight-to-quality">Flight-to-quality</a></li>
<li><a href="/wiki/Government_bond" title="Government bond">Government bond</a></li>
<li><a href="/wiki/Haircut_(finance)" title="Haircut (finance)">Haircut</a></li>
<li><a href="/wiki/Initial_public_offering" title="Initial public offering">Initial public offering</a></li>
<li><a href="/wiki/Long_(finance)" title="Long (finance)">Long</a></li>
<li><a href="/wiki/Margin_(finance)" title="Margin (finance)">Margin</a></li>
<li><a href="/wiki/Market_anomaly" title="Market anomaly">Market anomaly</a></li>
<li><a href="/wiki/Market_capitalization" title="Market capitalization">Market capitalization</a></li>
<li><a href="/wiki/Market_depth" title="Market depth">Market depth</a></li>
<li><a href="/wiki/Market_manipulation" title="Market manipulation">Market manipulation</a></li>
<li><a href="/wiki/Market_trend" title="Market trend">Market trend</a></li>
<li><a href="/wiki/Mean_reversion_(finance)" title="Mean reversion (finance)">Mean reversion</a></li>
<li><a href="/wiki/Momentum_(finance)" title="Momentum (finance)">Momentum</a></li>
<li><a href="/wiki/Open_outcry" title="Open outcry">Open outcry</a></li>
<li><a href="/wiki/Position_(finance)" title="Position (finance)">Position</a></li>
<li><a href="/wiki/Public_float" title="Public float">Public float</a></li>
<li><a href="/wiki/Public_offering" title="Public offering">Public offering</a></li>
<li><a href="/wiki/Rally_(stock_market)" title="Rally (stock market)">Rally</a></li>
<li><a href="/wiki/Returns-based_style_analysis" title="Returns-based style analysis">Returns-based style analysis</a></li>
<li><a href="/wiki/Reverse_stock_split" title="Reverse stock split">Reverse stock split</a></li>
<li><a href="/wiki/Share_repurchase" title="Share repurchase">Share repurchase</a></li>
<li><a href="/wiki/Short_(finance)" title="Short (finance)">Short selling</a></li>
<li><a href="/wiki/Slippage_(finance)" title="Slippage (finance)">Slippage</a></li>
<li><a href="/wiki/Speculation" title="Speculation">Speculation</a></li>
<li><a href="/wiki/Stock_dilution" title="Stock dilution">Stock dilution</a></li>
<li><a href="/wiki/Stock_exchange" title="Stock exchange">Stock exchange</a></li>
<li><a href="/wiki/Stock_market_index" title="Stock market index">Stock market index</a></li>
<li><a href="/wiki/Stock_split" title="Stock split">Stock split</a></li>
<li><a href="/wiki/Trade_(financial_instrument)" title="Trade (financial instrument)">Trade</a></li>
<li><a href="/wiki/Uptick_rule" title="Uptick rule">Uptick rule</a></li>
<li><a href="/wiki/Volatility_(finance)" title="Volatility (finance)">Volatility</a></li>
<li><a href="/wiki/Voting_interest" title="Voting interest">Voting interest</a></li>
<li><a href="/wiki/Yield_(finance)" title="Yield (finance)">Yield</a></li></ul>
</div></td></tr></tbody></table></div>
<div role="navigation" class="navbox" aria-labelledby="Hedge_funds" style="padding:3px"><table class="nowraplinks hlist mw-collapsible autocollapse navbox-inner" style="border-spacing:0;background:transparent;color:inherit"><tbody><tr><th scope="col" class="navbox-title" colspan="3"><div class="plainlinks hlist navbar mini"><ul><li class="nv-view"><a href="/wiki/Template:Hedge_funds" title="Template:Hedge funds"><abbr title="View this template" style=";;background:none transparent;border:none;-moz-box-shadow:none;-webkit-box-shadow:none;box-shadow:none; padding:0;">v</abbr></a></li><li class="nv-talk"><a href="/wiki/Template_talk:Hedge_funds" title="Template talk:Hedge funds"><abbr title="Discuss this template" style=";;background:none transparent;border:none;-moz-box-shadow:none;-webkit-box-shadow:none;box-shadow:none; padding:0;">t</abbr></a></li><li class="nv-edit"><a class="external text" href="https://en.wikipedia.org/w/index.php?title=Template:Hedge_funds&action=edit"><abbr title="Edit this template" style=";;background:none transparent;border:none;-moz-box-shadow:none;-webkit-box-shadow:none;box-shadow:none; padding:0;">e</abbr></a></li></ul></div><div id="Hedge_funds" style="font-size:114%;margin:0 4em"><a href="/wiki/Hedge_fund" title="Hedge fund">Hedge funds</a></div></th></tr><tr><th scope="row" class="navbox-group" style="width:1%">Investment<br />strategy</th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em"></div><table class="nowraplinks navbox-subgroup" style="border-spacing:0"><tbody><tr><th scope="row" class="navbox-group" style="width:7em"><a href="/wiki/Arbitrage" title="Arbitrage">Arbitrage</a> /<br /><a href="/wiki/Relative_value_(economics)" title="Relative value (economics)">relative value</a></th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Capital_structure#Arbitrage" title="Capital structure">Capital structure arbitrage</a></li>
<li><a href="/wiki/Convertible_arbitrage" title="Convertible arbitrage">Convertible arbitrage</a></li>
<li><a href="/wiki/Market_neutral#Equity-market-neutral" title="Market neutral">Equity market neutral</a></li>
<li><a href="/wiki/Fixed_income_arbitrage" title="Fixed income arbitrage">Fixed income arbitrage</a> / <a href="/wiki/Fixed-income_relative-value_investing" title="Fixed-income relative-value investing">fixed-income relative-value investing</a></li>
<li><a href="/wiki/Statistical_arbitrage" title="Statistical arbitrage">Statistical arbitrage</a></li>
<li><a href="/wiki/Volatility_arbitrage" title="Volatility arbitrage">Volatility arbitrage</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:7em"><a href="/wiki/Event-driven_investing" title="Event-driven investing">Event-driven</a></th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Activist_shareholder" title="Activist shareholder">Activist shareholder</a></li>
<li><a href="/wiki/Distressed_securities" title="Distressed securities">Distressed securities</a></li>
<li><a href="/wiki/Risk_arbitrage" title="Risk arbitrage">Risk arbitrage</a></li>
<li><a href="/wiki/Special_situation" title="Special situation">Special situation</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:7em">Directional</th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Convergence_trade" title="Convergence trade">Convergence trade</a></li>
<li><a href="/wiki/Commodity_trading_advisor" title="Commodity trading advisor">Commodity trading advisors</a> / <a href="/wiki/Managed_futures_account" title="Managed futures account">managed futures account</a></li>
<li><a href="/wiki/Short_(finance)" title="Short (finance)">Dedicated short</a></li>
<li><a href="/wiki/Global_macro" title="Global macro">Global macro</a></li>
<li><a href="/wiki/Long/short_equity" title="Long/short equity">Long/short equity</a></li>
<li><a href="/wiki/Trend_following" title="Trend following">Trend following</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:7em">Other</th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Fund_of_funds#Fund_of_hedge_funds" title="Fund of funds">Fund of hedge funds</a> / <a href="/wiki/Multi-manager_investment" title="Multi-manager investment">Multi-manager</a></li></ul>
</div></td></tr></tbody></table><div></div></td><td class="navbox-image" rowspan="5" style="width:1px;padding:0px 0px 0px 2px"><div><a href="/wiki/File:Chicklet-currency.jpg" class="image"><img alt="Chicklet-currency.jpg" src="//upload.wikimedia.org/wikipedia/commons/thumb/9/9f/Chicklet-currency.jpg/60px-Chicklet-currency.jpg" decoding="async" width="60" height="54" srcset="//upload.wikimedia.org/wikipedia/commons/thumb/9/9f/Chicklet-currency.jpg/90px-Chicklet-currency.jpg 1.5x, //upload.wikimedia.org/wikipedia/commons/thumb/9/9f/Chicklet-currency.jpg/120px-Chicklet-currency.jpg 2x" data-file-width="279" data-file-height="250" /></a></div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Trading</th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Algorithmic_trading" title="Algorithmic trading">Algorithmic trading</a></li>
<li><a href="/wiki/Day_trading" title="Day trading">Day trading</a></li>
<li><a href="/wiki/High-frequency_trading" title="High-frequency trading">High-frequency trading</a></li>
<li><a href="/wiki/Prime_brokerage" title="Prime brokerage">Prime brokerage</a></li>
<li><a href="/wiki/Program_trading" title="Program trading">Program trading</a></li>
<li><a href="/wiki/Proprietary_trading" title="Proprietary trading">Proprietary trading</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Related<br />terms</th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em"></div><table class="nowraplinks navbox-subgroup" style="border-spacing:0"><tbody><tr><th scope="row" class="navbox-group" style="width:7em">Markets</th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Commodity_market" title="Commodity market">Commodities</a></li>
<li><a href="/wiki/Derivative_(finance)" title="Derivative (finance)">Derivatives</a></li>
<li><a href="/wiki/Stock_market" title="Stock market">Equity</a></li>
<li><a href="/wiki/Bond_market" title="Bond market">Fixed income</a></li>
<li><a href="/wiki/Foreign_exchange_market" title="Foreign exchange market">Foreign exchange</a></li>
<li><a href="/wiki/Money_market" title="Money market">Money markets</a></li>
<li><a href="/wiki/Structured_finance" title="Structured finance">Structured securities</a></li></ul>
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<ul><li><a href="/wiki/Arbitrage_pricing_theory" title="Arbitrage pricing theory">Arbitrage pricing theory</a></li>
<li><a href="/wiki/Assets_under_management" title="Assets under management">Assets under management</a></li>
<li><a href="/wiki/Black%E2%80%93Scholes_model" title="Black–Scholes model">Black–Scholes model</a> (<a href="/wiki/Greeks_(finance)" title="Greeks (finance)">Greeks</a>: <a href="/wiki/Delta_neutral" title="Delta neutral">delta neutral</a>)</li>
<li><a href="/wiki/Capital_asset_pricing_model" title="Capital asset pricing model">Capital asset pricing model</a> (<a class="mw-selflink selflink">alpha</a> / <a href="/wiki/Beta_(finance)" title="Beta (finance)">beta</a> / <a href="/wiki/Security_characteristic_line" title="Security characteristic line">security characteristic line</a>)</li>
<li><a href="/wiki/Fundamental_analysis" title="Fundamental analysis">Fundamental analysis</a></li>
<li><a href="/wiki/Hedge_(finance)" title="Hedge (finance)">Hedge</a></li>
<li><a href="/wiki/Securitization" title="Securitization">Securitization</a></li>
<li><a href="/wiki/Short_(finance)" title="Short (finance)">Short</a></li>
<li><a href="/wiki/Taxation_of_private_equity_and_hedge_funds" title="Taxation of private equity and hedge funds">Taxation of private equity and hedge funds</a></li>
<li><a href="/wiki/Technical_analysis" title="Technical analysis">Technical analysis</a></li></ul>
</div></td></tr></tbody></table><div></div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Investors</th><td class="navbox-list navbox-even" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Vulture_fund" title="Vulture fund">Vulture funds</a></li>
<li><a href="/wiki/Family_office" title="Family office">Family offices</a></li>
<li><a href="/wiki/Financial_endowment" title="Financial endowment">Financial endowments</a></li>
<li><a href="/wiki/Fund_of_funds#Fund_of_hedge_funds" title="Fund of funds">Fund of hedge funds</a></li>
<li><a href="/wiki/High-net-worth_individual" title="High-net-worth individual">High-net-worth individual</a></li>
<li><a href="/wiki/Institutional_investor" title="Institutional investor">Institutional investors</a></li>
<li><a href="/wiki/Insurance#Insurance_companies" title="Insurance">Insurance companies</a></li>
<li><a href="/wiki/Investment_banking" title="Investment banking">Investment banks</a></li>
<li><a href="/wiki/Merchant_bank" title="Merchant bank">Merchant banks</a></li>
<li><a href="/wiki/Pension_fund" title="Pension fund">Pension funds</a></li>
<li><a href="/wiki/Sovereign_wealth_fund" title="Sovereign wealth fund">Sovereign wealth funds</a></li></ul>
</div></td></tr><tr><th scope="row" class="navbox-group" style="width:1%">Regulatory</th><td class="navbox-list navbox-odd" style="text-align:left;border-left-width:2px;border-left-style:solid;width:100%;padding:0px"><div style="padding:0em 0.25em">
<ul><li><a href="/wiki/Fund_governance" title="Fund governance">Fund governance</a></li>
<li><a href="/wiki/Hedge_Fund_Standards_Board" title="Hedge Fund Standards Board">Hedge Fund Standards Board</a></li></ul>
</div></td></tr><tr><td class="navbox-abovebelow" colspan="3"><div>
<ul><li><a href="/wiki/Category:Alternative_investment_management_companies" title="Category:Alternative investment management companies">Alternative investment management companies</a></li>
<li><a href="/wiki/Category:Hedge_funds" title="Category:Hedge funds">Hedge funds</a></li>
<li><a href="/wiki/Category:Hedge_fund_managers" title="Category:Hedge fund managers">Hedge fund managers</a></li></ul>
</div></td></tr></tbody></table></div>
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