Alternative Beta

Alternative Beta refers to investment returns that come from sources other than traditional market movements, such as stocks or bonds. It captures the value added through unique strategies like hedge funds, options, or other non-traditional assets, which aim to generate returns regardless of overall market direction. Essentially, it measures how well these alternative strategies perform independently of general market trends, providing diversification and potential risk reduction. This concept helps investors understand how much of their portfolio's performance is due to innovative or non-traditional investments beyond standard stocks and bonds.