What does alpha measure? What alpha would you like to see on your investments? Common advice on Wall Street is \"Keep your alpha high and your beta low.\" Why? Explain in your own words. In recent years, it has been common for companies to experience significant stock price changes in reaction to announcements of massive layoffs. Critics charge that such events encourage companies to fire long- time employees and that Wall Street is cheering them on. Do you agree or disagree? Earnings announcements by companies are closely followed by, and frequently result in, share price revisions. Two issues should come to mind. First, earnings announcements concern past periods. If the market values stocks based on expectations of the future, why are numbers summarizing past performance relevant? Second, these announcements concern accounting earnings. Although, such earnings may have little to do with cash flow, so, again, why are they relevant