Alpha Definition & Application Wiki

Alpha Definition & Application Wiki

Last Updated by WikiWealth

Short Definition:

Risk factors not incorporated into the financial data of a company such as bankruptcy and financial disasters.

Wikiwealth uses alpha to increase the discount rate to investments, which add investment risk not forecastable, after reviewing company financial statements, industry reports, or other publicly available information (e.g. Litigation Risk).

Long Definition:

See Dictionary Terms

See Academic Resources

Source: http://en.wikipedia.org/wiki/Alpha_(investment)