What is quantitative analysis (QA)? ~ Knowledgehu92.info

What is quantitative analysis (QA)?

Quantitative analysis (QA)

Quantitative Analysis (QA) may be a method that seeks to know behavior through mathematical and statistical modeling, measurement, and research. Quantitative analysts seek to present this reality as a numerical value.

Quantitative analysis is used for several reasons, including measuring, evaluating the effectiveness or evaluating a financial instrument and forecasting real events, such as changes in a country's gross domestic product (GDP).

What does a quantitative analyst do?

KEY TAKEAWAYS
Quantitative Analysis (QA) may be a method that seeks to know behavior through mathematical and statistical modeling, measurement, and research.
Quantitative analysts seek to present this reality as a numerical value.
Quantitative analysis is used for several reasons, including measuring, evaluating the effectiveness or evaluating a financial instrument and forecasting real events, such as changes in a country's gross domestic product (GDP).

Understanding Quantitative Analysis (QA)

Quantitative analysis provides analysts with tools to study and analyze past, current, and expected future events. Any item including numbers can be quantified; Thus, there are many areas in which quantitative analysis is used and is useful.

For example, quantitative analysis is used in analytical chemistry, financial analysis, social sciences, and organized sports. In the financial world, analysts who rely strictly on quantitative analysis are often referred to as "quanta" or "quantum jockeys."
In the financial services industry, QA is used to analyze investment opportunities, such as when to buy or sell securities. Investors conduct quantitative analyzes when they use key financial ratios, such as price-earnings ratio (P / E) or earnings per share (EPS), in the process of making investment decisions (for example, whether to buy shares in a company's stock). Quantitative analysis ranges from studying simple statistics (e.g., revenue) to complex calculations (e.g., discounted cash flows or option prices).

Quantitative analysis versus qualitative analysis

Although quantitative analysis provides a useful assessment tool, it is often combined with an additional research and evaluation tool for qualitative analysis. Typically, companies use quantitative analysis to measure indicators such as sales revenue, return on assets, or return on assets (ROA).

However, in order to gain a better understanding of the company's performance, analysts also evaluate information that is not quantifiable or comes down to numerical values, such as employee reputation or morale. Qualitative analysis focuses on values, includes contextual sensitivity, rather than the desire to obtain universal generalizations, and aims to create rich descriptions rather than quantitative indicators. Qualitative analysis seeks to answer the questions of “why” and “how” of human behavior.

In a combined project of qualitative and quantitative analysis, a company, analyst or investor may want to evaluate the strength of the product. Quality tools used for the project may include customer surveys and group discussions. A quantitative chemical analysis of the merchandise also can be initiated by examining data on the amount of normal customers, customer complaints and therefore the number of warranty claims for a specific period.

Quantitative analysis is not the opposite of qualitative analysis; these are just different philosophies. When used together, they can provide useful information for making informed decisions that contribute to improving society, improving the financial situation and expanding business operations.