Alpha2 Study

By Samantha Baltodano

What Is The Alpha2 Study?

As opposed to Jensen's Alpha, the Alpha2 study calculates the excess average return of a benchmark index relative to the average return of a security or portfolio. 

Thus, it is equal to the average rate of change in benchmark index price minus that of the security multiplied by benchmark Beta2. Alpha2 assumes that the security has a Beta2 of 1.0.

Alpha2 is just one of many studies that Archaide automates. For a full list of strategies and studies available click here.

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