Alpha is the holy grail of active management — it indicates value created beyond market exposure (beta). It can stem from superior asset selection, timing, or strategy design. For allocators, consistent alpha generation across cycles is a key performance indicator. It is often evaluated alongside risk metrics like Sharpe Ratio and drawdown. Strategies such as Market Neutral and Quantitative Trading are designed to isolate and maximize alpha. Confluence — or the alignment of multiple alpha signals — can also amplify return potential in multi-strategy funds.