What is Qualitative Analysis of Stocks

1. What is Qualitative Analysis of Stocks? And How to Perform it? When it comes to buying a particular stock from the market, the first thing people look at its performance over the past few months or even weeks. For many, it becomes difficult to gauge the actual performance of the stock as there are hundreds of factors that play a great role in determining the past and future performance of a stock and one of the proven ways to get them is a qualitative analysis of stocks. Generally, we look at the past numbers of the stock like its growth rate, the volume of shares, dividend yield, Net profit, margin, etc, but this is where miss the other side of the coin –qualitative aspect. Let’s find out what qualitative analysis is and how can it help traders and investors in choosing the most appropriate stock. What does Qualitative analysis of stocks mean? Qualitative analysis refers to the use of non-quantifiable details in a bid to determine the investment scenarios of a company. This information may be inclusive of management quality, the satisfaction of its stakeholders, morals, brand value, etc. This is also called soft information. This soft data primarily relates to the factors that are intangible. As far as quantitative analysis is considered, it actually includes the inspection of numbers like income statement ratios, net profit, margin, dividend, cash flow statement, balance sheet. The major influence of differentiation is that quantitative data can be chomped by artificial intelligence using strong analytical tools. On the other hand, qualitative analysis requires a human approach to data fetching. Though getting details about them is a bit difficult, they still play a greater role in business analysis. All top 10 stock brokers in India take these factors into consideration while doing such analysis.