Jensen's alpha

noun

A metric used to determine the abnormal return of a security or portfolio over the theoretical expected return.

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Meanings

nounJensen's alpha (plural Jensen's alphas)

plural Jensen's alphas

  1. businessA metric used to determine the abnormal return of a security or portfolio over the theoretical expected return.

Origin

First used as a measure in the evaluation of mutual fund managers by Michael C. Jensen in 1968.

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Cite this entry
APA

Jensen's alpha. (n.d.). In WatkinsX Dictionary. Retrieved November 4, 2026, from https://dictionary.watkinsx.com/word/Jensen's%20alpha

MLA

“Jensen's alpha.” WatkinsX Dictionary, https://dictionary.watkinsx.com/word/Jensen's%20alpha. Accessed November 4, 2026.

Chicago

WatkinsX Dictionary, s.v. “Jensen's alpha,” accessed November 4, 2026, https://dictionary.watkinsx.com/word/Jensen's%20alpha.

Source: Jensen's alpha on Wiktionary, CC BY-SA 4.0.