In finance, “alpha” refers to a measure of investment performance that indicates the excess return of an investment or portfolio compared to a benchmark. It is a way to assess an investment’s ability to generate returns beyond what would be expected based on its exposure to systematic risk factors. Positive alpha suggests that the investment or portfolio has outperformed the benchmark, while negative alpha indicates underperformance. Alpha is considered a measure of risk-adjusted performance because it takes into account the level of risk undertaken to achieve the returns.
Alpha ratings provides Ranks and Ratings to instruments based on Alpha, or how consistent they are at generating better risk adjusted returns than the benchmark index. High rated instruments are ideal for long-term investing or accumulating.
Alpha Ratings are very different from other ratings systems as they are not based on subjective or fundamental analysis. They are free of human biases, opinions and emotions. The ratings are completely automated.