📈 Jensen’s Alpha Calculator
Measure a portfolio’s risk-adjusted performance against what CAPM would predict, using Jensen’s Alpha.
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What is Jensen’s Alpha?
Jensen’s Alpha measures a portfolio’s risk-adjusted performance by comparing its actual return to the return predicted by the Capital Asset Pricing Model (CAPM), given its level of systematic risk (beta).
The formula
Jensen’s Alpha = Portfolio Return − [Risk-Free Rate + Beta × (Market Return − Risk-Free Rate)]. A positive alpha means the portfolio outperformed what its risk level would predict; a negative alpha means it underperformed.
This calculator is for general investment-analysis education, not investment advice.
Last reviewed August 2026