Total Risk Alpha Indicator

Investors can use prediction functions to forecast historical stock prices and determine the direction of financial instruments such as stocks, funds, or ETFs's future trends based on various well-known forecasting models. However, exclusively looking at the historical price movement is usually misleading. Macroaxis recommends to always use this module together with analysis of historical fundamentals such as revenue growth or operating cash flow patterns. Check out Investing Opportunities.

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Total Risk Alpha In A Nutshell

Total risk alpha measures the performance of an asset while comparing it to the benchmark. Now, there are two pieces to this, and they are total risk and alpha. Alpha is the return generated from an investment and should be monitored closely. 


If you take a look at any mutual fund, odds are you will see that it is being compared to a benchmark in the industry. For example, the S&P mutual funds are compared with the S&P 500 as the benchmark.

Closer Look at Total Risk Alpha

Alpha is one of the first items many people ask when they are searching for an investment. It is important to understand the historical return over a period of time. Typically people invest in funds for quite some time, so they may be looking at the returns generated over a 3, 5, or 10 year period.

Then there is total risk, which is self explanatory. Total risk is how much you are risking for the potential returns of your investment. Risk needs to be kept in line because you can lessen certain risks such as company specific risk and duration risk. If you need help, an investing professional can certainly define these and help apply them to your current situation.

Now, total risk alpha compares the investment against the benchmark and it is important for you to understand what makes up the benchmark as well as the risk levels associated. This is a way to compare what you may invest in because sometimes the benchmark may be the better investment. Now each sector of the market will have its own unique risks and profile because the financial sector will be exposed to risks the food industry may not be exposed too.

Understanding risk and comparison against benchmarks is crucial and will hopefully give you clarity in your investing plans. Benchmarks are typically used with many products over different institutions, but be sure the benchmark is reputable. If you still are unsure, reach out to an investing community and bounce your questions off of them. Knowing what your investment is being compared against is crucial because you want to know your fund is accurately being managed and taken care of.

Be your own money manager

Our tools can tell you how much better you can do entering a position in Investor Education without increasing your portfolio risk or giving up expected return. As an individual investor, you need to find a reliable way to track all your investment portfolios. However, your requirements will often be based on how much of the process you decide to do yourself. In addition to allowing all investors analytical transparency into all their portfolios, our tools can evaluate.risk-adjusted returns of your individual positions relative to your overall portfolio.

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Macroaxis puts the power of mathematics on your side. We analyze your portfolios and positions such as Investor Education using complex mathematical models and algorithms, but make them easy to understand. There is no real person involved in your portfolio analysis. We perform a number of calculations to compute absolute and relative portfolio volatility, correlation between your assets, value at risk, expected return as well as over 100 different fundamental and technical indicators.

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Check out Investing Opportunities. Note that the Investor Education information on this page should be used as a complementary analysis to other Investor Education statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

Other Tools for Investor Private

When running Investor Education price analysis, check to measure Investor Education market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Investor Education is operating at the current time. Most of Investor Education value examination focuses on studying past and present price action to predict the probability of Investor Education future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Investor Education price. Additionally, you may evaluate how the addition of Investor Education to your portfolios can decrease your overall portfolio volatility.
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