Portable alpha is the return of an investment portfolio with zero market risk (beta). Being independent of both the direction and the magnitude of the market's movements, it represents the manager's skill in selecting investments. Elimination of the market risk can be accomplished by means of short selling and derivatives such as futures, swaps, and options.
See Alpha for a definition of alpha.
Here, Portable Alpha implies that the extra returns (alpha) can be separated from the changes of the market by hedging the market exposure of the portfolio.
The process of Portable Alpha is also sometimes referred to as Alpha Transport
Read more about Portable Alpha: Example of Portable Alpha, Usage of A Portable Alpha Manager
Other articles related to "portable alpha, alpha":
... through use of passive investments, and use Leverage against this portfolio to invest in the portable alpha manager ... As long as the manager returns enough alpha to cover their costs of investing (interest and fees), the investor can port the excess return to his portfolio ... board might be convinced that they can circumvent this policy for a portable alpha manager who invests in commodities, because he hedges out his exposure to the commodities market ...
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