Glossary term

Alpha

When used as an indication of active return on an investment, it measures the asset price against the overall market movement. The excess return of investment relative to…

  • Updated September 8, 2022
  • First published March 29, 2022
  • Reading time 1 minute

Definition

Understand the fundamentals, context, and nuances behind this term.

When used as an indication of active return on an investment, it measures the asset price against the overall market movement. The excess return of investment relative to the return of the market is the investment's alpha.

When used to indicate software status, it refers to the very first version or the basic software of a project.