What are the implications of alpha and beta in digital asset investment?

Can you explain the significance of alpha and beta in the context of investing in digital assets? How do these metrics affect investment decisions and portfolio performance?

1 answers
- At BYDFi, we understand the implications of alpha and beta in digital asset investment. Alpha represents the excess return earned by an investment after adjusting for market risk, while beta measures the sensitivity of an investment's returns to market movements. These metrics play a crucial role in evaluating the performance and risk of digital asset investments. Positive alpha indicates that the investment has outperformed the market, while negative alpha suggests underperformance. Beta helps investors understand the volatility and correlation of their portfolio with the market. By considering alpha and beta, investors can make informed decisions to optimize their digital asset investment strategies and achieve their financial goals.
Mar 19, 2022 · 3 years ago
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