A method of transporting the active return (alpha) among asset classes by separating and transporting uncorrelated incremental returns from one asset class to another. The execution of alpha transport strategies usually engages instruments that provide notional leverage such as futures contracts. These strategies particularly suit efficient asset classes which produce tiny alphas (in which case beta almost always explains most of the returns). Broadly speaking, alpha transport strategies involve structuring liquid derivatives baskets to replicate index returns and investing cash outside the index to generate alpha. Typically, the asset class to which alpha is conveyed is passively replicated by a derivative contract. The alpha instrument serves as collateral for the derivative contracts that produce the passive return. In other words, the alpha generator is overlaid by a swap or futures contract (which serves as the source of passive index return). The alpha component can be very simple (e.g., short-term bonds) or quite complex (as a number of hedge funds).

Alpha transport is also known as portable alpha.