Glossary
Quant investing terms, in plain English
Definitions for the concepts behind every QScore — what each factor measures, how scores are normalized, what the signal labels mean — alongside a short reference for the general quant finance terms (P/E, RSI, beta, Sharpe, information coefficient) that show up in the methodology.
QScore concepts
Terms specific to how the QScore is built — what each factor measures, how scores combine, and what the signal and confidence labels mean.
- Composite ScoreThe 1–100 headline number that summarizes a stock's quantitative attractiveness across five factor categories.
- ConfidenceA High / Medium / Low rating that captures how complete the input data is and how decisive the score is.
- Growth FactorHow quickly the underlying business is getting bigger and more profitable per share.
- Momentum FactorRecent price-based signals — has this stock been outperforming, and is the trend healthy?
- Profitability FactorHow efficiently the business converts capital into profit and cash.
- Risk FactorHow much the stock moves with the market and how much it moves on its own.
- Sector NormalizationComparing each stock to its sector peers rather than to the entire market — accounting for the fact that 'normal' looks different in each industry.
- SignalThe directional verdict — Buy Long-Term, Buy Short-Term, Hold, or Short — derived from the composite scores.
- Value FactorHow cheap a stock looks relative to its fundamentals — earnings, book value, sales, EBITDA.
- Z-Score NormalizationA statistical transformation that converts raw metrics to a comparable scale by measuring distance from the average in standard deviations.
Quant finance basics
General terms from quantitative finance that show up across the methodology and the academic factor research it draws from.
- BetaHow much a stock's price moves relative to the overall market — high beta means amplified market moves.
- Information CoefficientThe rank correlation between predicted scores and forward returns — how well a quant signal predicts the future.
- P/E RatioPrice divided by earnings per share — what the market is paying for each dollar of profit.
- RSI (Relative Strength Index)A 0–100 oscillator that flags when a stock is overbought or oversold, computed from recent gains vs losses.
- Sharpe RatioExcess return divided by volatility — how much extra return a strategy delivers per unit of risk.