Alpha Coefficient(redirected from Alpha (investment))
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In the capital asset pricing model, a measure of an investment's performance over and above the performance of investments of the same risk. It is graphically represented by the intersection of the security characteristic line and the x-axis. In a perfectly efficient market, the alpha coefficient ought to be zero (that is, all investments with the same risk should perform the same), but this rarely happens. It is also called Treynor's alpha. See also: Alpha.