Alpha refers to the excess return of each asset—the input is subject to error and bias and as a result is sometimes unreasonable.
Transaction costs are an important input for portfolio construction but they also contain a degree of uncertainty. Transaction costs must be amortized over the investment horizon in order to determine the optimal portfolio adjustments.
Active risk aversion must be consistent with the specified target active risk level. Active risk is another name for tracking error, which is the standard deviation of active return.
