Calculate the alpha and cumulative


Calculate the alpha and Cumulative alpha.

Firm beta is 1.5

Month

Stock excess return

Benchmark excess return

Monthly alpha

Cumulative alpha

1

0.04

0.03

 

 

2

0.04

0.05

 

 

3

-0.08

-0.10

 

 

4

0.15

0.12

 

 

5

0.10

0.10

 

 

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Finance Basics: Calculate the alpha and cumulative
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