Search for other tools and definitions of quantitative analysis on the internet. Find at least two of each that are easy to understand. Quote them and insert links to them on your blog.
Quantitative Analysis Definitions:
1) Quantitative analysis (finance), an analysis technic applying mathematics stochastic calculus to finance. Link: http://en.wikipedia.org/wiki/Quantitative_analysis.
2) The process of determining the value of a security by examining its numerical, measurable characteristics such as revenues, earnings, margins, and market share.
Link: http://www.investorwords.com/4001/quantitative_analysis.html#ixzz13LTD3AEE
Link: http://www.investorwords.com/4001/quantitative_analysis.html#ixzz13LTD3AEE
Quantitative Analysis Tools:
1) Discounted Cash Flow (DCF),
What Does Discounted Cash Flow (DCF) Mean?
A valuation method used to estimate the attractiveness of an investment opportunity. DCF analysis uses future free cash flow projections and discounts them (most often by using the weighted average cost of capital method) to arrive at a present value, which is used to evaluate the investment's potential. If the value arrived at through DCF analysis is higher than the current cost of the investment, the opportunity may be a good one. It is calculated as follows:
2) Free Cash Flow (FCF)
What Does Free Cash Flow (FCF) Mean?
A measure of financial performance calculated as operating cash flow minus capital expenditures. Free cash flow represents the cash that a company is able to generate after laying out the money required to maintain or expand its asset base. Free cash flow is important because it allows a company to pursue opportunities that enhance shareholder value. Without cash, it is tough to develop new products, make acquisitions, pay dividends, and reduce debt. FCF is calculated as follows:
It also can be calculated by taking operating cash flow and subtracting capital expenditures.
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