Free Online Calculators » Jensen's alpha Calculator

Jensen's alpha is used to determine the abnormal return of a security or portfolio of securities over the theoretical expected return.

Initial Data

Annual return on investment (ri)
Risk-free interest rate (rf)
Beta of the portfolio (βi)
Annual return of the market benchmark (rm)


Jensen's alpha:

$$\alpha_{J}=r_{i}-\left [ r_{f}+\beta_{iM} \times (r_{M}-r_{f})\right ]$$