Quadrix is designed to help investors identify stocks that will outperform the market over the next 6 to 12 months.
It uses more than two decades of backtests and more than 50 variables in its calculations, including price-earnings ratios, earnings growth rates, price momentum and book-to-market ratios.
The Quadrix system helps investors identify stocks that have a strong combination of financial and operating characteristics, and that are likely to outperform the market over time.
It is used by both individual and institutional investors and is widely regarded as a powerful tool for stock analysis and selection.
Categories of variables used in Quadrix
The variables used in Quadrix are divided into three categories: financial, technical, and fundamental.
- Financial variables: These include price/book ratio, dividend yield and earnings yield. These variables help to determine whether a stock is overvalued or undervalued relative to its peers.
- Technical variables: These include momentum and volatility. They measure the strength of a stock’s performance over time and its tendency to move up or down during periods of market stress (for example during times of high volatility).
- Fundamental variables: These include sales growth rate, and earnings growth rate — all key factors that must be considered when evaluating companies for investment purposes.
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