Why is a stock that rises when the market falls yet still earns a positive return so valuable that it can't survive, and what does that say about alpha?
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Candidate hedges for the autumn 2008 market
List Campbell's Soup, Wal-Mart, Freddie Mac and Philip Morris, and record for each the correlation with the economy it most plausibly has: zero, positive or weakly positive.
Negative correlation together with a positive expected return
State the two conditions a valuable hedge must meet at once, and record that shorting the market meets the first but carries a negative expected return.
Competition erasing the opportunity through
Write expected return as and trace step by step what everyone buying such a stock does to and then to its expected return.
Alpha as the benchmark for judging managers
Define alpha as the distance a manager puts you North-West of the tangency line, tie it to a 2-and-20 fee, and record Buffett's realized Sharpe ratio of about 0.76 and the identify-them-early catch.