Ex Post Alpha is best described as?

Ex Post Alpha refers to the measure of an investment's performance relative to a benchmark after the investment has been made and the actual returns have been realized. It evaluates the incremental return generated by the investment over and above what would be expected based on the risk undertaken, as determined by the benchmark’s performance. This evaluation is crucial for investors, as it allows them to assess the effectiveness of their investment strategies and the skill of the portfolio manager in generating excess returns.

This concept involves realizing returns that have already occurred, taking into account the specific risks associated with those returns. Thus, it provides a retrospective analysis of performance, which makes the designation of "realized incremental returns after risk adjustment" aptly descriptive.

In contrast, the other options focus on either future predictions or unadjusted calculations, which do not align with the definition of Ex Post Alpha. Therefore, the correct understanding of Ex Post Alpha is inherently tied to observed performance metrics following an investment's execution.