Investments

Alpha’s residual nature

In my last article, “The true cost of beta,” (June 2011), I noted that a portfolio manager’s return is made of two components: beta and alpha. Alpha is the extra return generated through manager skill above the return accounted for by the risk premium of the underlying factors the portfolio is exposed to. Alpha is a rare and fleeting commodity that fetches a higher price if it’s sustainable in the long run. Alpha is what is left after we’ve accounted for the beta portion of a manager’s return — it’s a residual value.

By Guy Lalonde |September 1, 2011

5 min read

IIROC rules target bond, OTC markets

The Investment Industry Regulatory Organization of Canada is taking steps to address fair pricing in the fixed income market, as well as in other securities traded over the counter.

By Staff |September 1, 2011

2 min read

Risk is back

Advisors now face the challenge of reassessing not only their clients’ risk tolerance levels, but also the nature of risk itself, thanks to the downgrade of U.S. debt to below AAA.

By Harper Fraze |September 1, 2011

6 min read

Dow Jones calls large-cap ‘dead cross’

Here's one for the technical analysis fans: U.S. large cap stocks are set to tank. That's according to Dow Jones Indexes, which found the market has hit a "dead cross" using a quantitative rules-based algorithm

By Staff |August 31, 2011

1 min read