Equity Investments Q109

Statement 1: Alpha is used to measure the market sentiment.

Statement 2: Alpha is the difference between the return on the actively managed portfolio and the passive portfolio.

Statement 3: Alpha is the systematic risk of a security, using index as a proxy for the entire market.

Option : B
Explanation : Alpha is the difference between the return on the actively managed portfolio and the passive portfolio and is used to measure the riskadjusted return.

I agree with the Terms.