Static Testing: A form of software testing where the software isn't actually used it checks mainly for the sanity of the code, algorithm, or document. It is used by the developer who wrote the code. 89. Stability Testing: Testing technique which attempts to determine if an application will crash.
Before we start, you'll need to understand a few key terms and concepts, namely alpha, beta, systematic risk and idiosyncratic risk. Beta - The return generated from a portfolio that can be attributed to overall market returns. Exposure to beta is equivalent to exposure to systematic risk. The alpha is the portion of a portfolio's return that cannot be attributed to market returns, and is thus independent from market returns.
Regression, Alpha, R-Squared. One use of CAPM is to analyze the performance of mutual funds and other portfolios - in particular, to make active fund managers look bad. Each data point in this graph shows the risk-adjusted return of the portfolio and that of the index over one time period in the past. r - Rf = beta x ( Km - Rf ) + alpha. where r is the fund's return rate, Rf is the risk-free return rate, and Km is the return of the index.