**Question:** A non-zero alpha can be an arbitrage opportunity.- **True**- **False**This question prompts the learner to determine whether a non-zero alpha constitutes an arbitrage opportunity. Alpha, in finance, refers to the excess returns of an investment relative to the return of a benchmark index. A non-zero alpha indicates that the investment has either exceeded (positive alpha) or underperformed (negative alpha) the benchmark. Arbitrage opportunities arise when there is a chance to profit from price differences of identical or similar financial instruments across different markets or forms, without risk.

Alpha is a measure of the returns of a security which is above the expected returns from that…

Answered: A non-zero alpha can be an arbitrage…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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A non-zero alpha can be an arbitrage opportunity. O True O False