Federico
Tue Oct 08 2024
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5 answers
612
Is positive alpha overpriced?
The concept of positive alpha, or outperforming a benchmark index, has been a cornerstone of financial investing for decades. However, with the rise of passive investing and the proliferation of index funds, some investors are questioning whether the pursuit of positive alpha is still worth the cost. Are active managers truly able to consistently generate alpha, or is it simply a result of luck and market timing? Furthermore, are the fees charged by active managers for their services justified, given the potential for underperformance? Ultimately, the question remains: is positive alpha overpriced, or is it still a valuable investment strategy?
