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A measure of risk-adjusted performance that looks at the volatility of a fund and compares its risk-adjusted return to a benchmark index. The return of the fund in excess of that of its benchmark is the fund’s alpha - the reward for taking on that additional risk. Eg. Alpha of 0.5% means the fund outperformed the benchmark by 0.5%. A negative alpha, say -0.5% means the fund’s performance was 0.5% less than its benchmark, once the volatility had been considered.