Generating alpha: benefiting from beta

Speaking at sister publication AsiaRisk's conference in Hong Kong last week, Franzi said defining beta in FX is, however, more difficult than in other markets, where for every long position there is a short position. "In essence, beta represents the inherent systematic returns of a market. However, in long-short markets, it's a zero-sum game - so for every winner there has to be a loser."

For beta to exist, there must be non-profit seekers, such as those purely looking for liquidity, and a set of