Portable Alpha is Portable Potty
The Wall Street Journal has an article on portable alpha this morning - investing a portion in an index (beta) and a portion in derivatives to capture hedge fund returns (alpha). Apparently this is the investment rage and I have heard the term frequently. Wall Street's big firms are coming out with products to capture this alpha. But as more people invest, as a quote at the end of the article from William Bernstein suggests, alpha will shrink (efficient markets) making alpha that much harder to obtain.