Quantitative Analysis – Definition

Cite this article as:"Quantitative Analysis – Definition," in The Business Professor, updated December 3, 2019, last accessed July 5, 2020, https://thebusinessprofessor.com/lesson/quantitative-analysis-definition/.

Back to: RESEARCH, ANALYSIS, & DECISION SCIENCE

Quantitative Analysis (QA) Definition

Quantitative analysis (QA) refers to a measure or an approach to understanding a particular behavior through the application of mathematical or statistical models. Quantitative analysis is used for many purposes and in many fields, it seeks to use numeric value to represent behaviors and events.

It is often used to predict or determine how real happenings or actual behaviors occur, whether it is in the oast, present or future. In finance, quantitative analysis is used for the evaluation of a financial instrument as well as the analysis and interpretation of changes that occur in a country’s economy.

A Little More on What is Quantitative Analysis (QA)

Quantitative analysis is used for the analysis of any behavior or event that is quantifiable. In quantitative analysis, several measures are used in the analysis or evaluation of events, these include the collection of data, organization, interpretation, and presentation of data to reflect how events occur and changes that affect them.

In governance, quantitative analysis is important for decision making with regard to the economy. It helps the government evaluate economic figures and study changes that occur. The investor also uses quantitative analysis is a key metric if determining whether an investment is a good or bad one. Financial analysts also deploy the use of quantitative analysis when tracking and analyzing financial reports.

Quantitative Analysis Versus Qualitative Analysis

Qualitative analysis is different from quantitative analysis because it uses non-quantifiable and non-numeric information to evaluate events. When used for the evaluation of a business, qualitative takes into account how the management, workplace culture, workplace hierarchy, and others affect the performance of the business. Quantitative analysis, on the other hand, uses figures and numbers in the analysis of the performance of a business.

In order to arrive at a comprehensive and accurate evaluation of a subject matter, analysts use both qualitative and quantitative analysis. For instance, when both analyses are used to the evaluation of a manufactured item, the number of items purchased by customers, the number of complaints received and other numeric and quantifiable data are used for quantitative analysis while the reviews of customers, preference for another similar item and attitude towards the item are considered for the qualitative approach.

Here are some quick points you should know about quantitative analysis;

  • Quantitative analysis uses numeric information and quantifiable data for the analysis of an event, whether past, present or future.
  • Quantitative analysis fices on mathematical models and statistics in understanding the occurrence of an event.
  • This form of analysis is used for several reasons and in fields, including the evaluation of a financial or investment instrument, a company’s finance, economic value, and other events.
  • Quantitative analysis focuses on giving a numerical presentation of events.

References for “Quantitative Analysis (QA)

https://www.investopedia.com › Investing › Financial Analysis

https://quantitativeanalysis.com/

https://corporatefinanceinstitute.com › Resources › Knowledge › Finance

https://www.myaccountingcourse.com › Accounting Dictionary

https://en.wikipedia.org/wiki/Quantitative_analysis_(finance)

Was this article helpful?