How Risky Is It? · Intermediate
Alpha: what it means and how to read it
How much the stock returned above or below what its market risk (beta) would predict.
What is Alpha?
How much the stock returned above or below what its market risk (beta) would predict.
A worked example
A stock with a beta of 1.2 in a year when the market rose 10% would be expected to rise about 12%. If it rose 17%, it did about 5 points better than its risk explains.
Why does Alpha matter?
Separates genuine outperformance from simply riding a rising market.
How do you read Alpha?
Positive means it did better than its risk level suggests. Past alpha may not repeat.
Higher is usually better.
What is a typical Alpha in India today?
The median across the 4240 listed companies that report it, as of 12 Oct 2026. Half sit above each figure and half below.
By company size
Median
Large Cap · 88 companies8.93
Mid Cap · 135 companies4.91
Small Cap · 4017 companies-1.48
By industry
Median, largest industries first
Pharmaceuticals · 17214.02
Private Sector Bank · 1835.20
Refineries & Marketing · 8-5.13
Public Sector Bank · 129.13
Computers - Software & Consulting · 53-15.32
Power Generation · 24-8.77
Heavy Electrical Equipment · 3914.56
Auto Components & Equipments · 9614.57
Non Banking Financial Company (NBFC) · 44-0.82
Aerospace & Defense · 2928.41
Compare a company with its own industry before the whole market. Every industry, and each company's rank within it, is in the screener.
What is Alpha for India's largest companies today?
The latest figure for the largest companies with a page here. Each links to what the rest of that company's numbers mean.
Alpha
As of 12 Oct 2026
Reliance Industries-4.49
Bharti Airtel3.52
HDFC Bank0.00
ICICI Bank9.03
State Bank of India21.82
Bajaj Finance0.00
Larsen & Toubro8.82