In a classical alpha beta separation, you gain beta exposure via a low cost index fund or ETF and generate alpha by entering into long-short strategy which is market neutral. Now what exactly is portable alpha strategy… Is this same as above? pls clarify. thanks, bn
Yes, as much as I can understand, it is the same thing. It gives the investor the ability to combine a given market exposure with the desired alpha. Because you can derive alpha from any asset class without having exposure to those asset classes.
a good read on portable alpha http://www.euromoney-yearbooks.com/images/143/downloads/MORGANSTANLEY1FINAL.pdf
thanks guys… the link provided is very useful… - bn