Alpha Life Cycle
The Alpha Life Cycle add-in divides the total alpha for the portfolio into three buckets: start, middle and end. It may also help portfolio managers understand when they are generating the most alpha. Not enough alpha at the start may indicate that you get into names too soon. Not enough alpha at the end, may indicate that you stay in names too long.
This add-in requires a profit attribution to be displayed in the main grid. It reflects the profit attribution of the row selected in the main grid and the date range indicated at the bottom right of the application. The date range of the entire screen (main grid and add-in), can be changed under the Screen tab on the right side of the application.
The calculations are done at the position level. If your portfolio has two positions, and the first was held for 300 days and the second was held for 30 days, then the “start” alpha is the alpha generated during the first 100 days of the first position plus the alpha generated during the first 10 days of the second position.