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Trading and Investment Terms

Quantitative Analysis (QA)

Quantitative analysis (QA) can be defined as a strategy that tries to learn nature of something with the help of mathematical and statistical modeling, measurement, and research.


Quantitative analysts seek to reflect a given reality in terms of its numerical worth.


Quantitative analysis is used for various reasons, that include calculation, performance assessment or valuation of a security, and foreseeing real-world events, for example, changes in a nation's gross domestic product (GDP).


Quantitative analysis gives analysts instruments to look and examine past, current, and foreseen future events.


Any subject including numbers can be measured; there are in this manner, numerous fields in which quantitative analysis is utilized and is gainful.


For instance, quantitative analysis is utilized in analytical science, stock analysis, sociology, as well as sports.


In the financial world, analysts who base their analysis only on quantitative methodologies are often known as "quants" or "quant jockeys."


In the financial services business, quantitative analysis is used to break down trading and investment opportunities, for instance, when to buy or sell stocks.


Investors perform quantitative analysis when utilizing key financial ratios, such as the price to earnings ratio (P/E) or earnings per share (EPS), in their process of investment decision making.


Quantitative analysis ranges from the assessment of basic statistical information (e.g., revenue) to complex calculations (e.g., discounted cash flow or option pricing).