n NISM Certifications
XXI NISM Series XXI-A
Medium

Which of the following best describes "Alpha" in investment performance?

Practice question from NISM XXI A for PMS - Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    The total return of a portfolio

  2. The excess return above the benchmark's return

    Correct answer

  3. C

    The market risk of a security

  4. D

    The beta coefficient of a security

Why this is the answer

Alpha measures outperformance relative to a benchmark.

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