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Complete reference guide for QuantVec - terminology, methodology, and features

Getting Started

What is QuantVec?

QuantVec is a quantitative stock analysis platform that helps you make data-driven investment decisions. Instead of relying on news or opinions, QuantVec uses statistical methods to identify stocks with unusual momentum, relative strength, and favorable risk characteristics.

Recommended Workflow

1

Check Market Health

Start with Market Health to understand overall conditions. Is the market oversold? Extended? How many stocks are in drawdown? This sets context for individual stock decisions.

2

Identify Market Leaders

Use Cross-Sectional Analysis or Z-Score Momentum to find stocks showing relative strength. Focus on stocks in the top percentiles with statistically significant momentum.

3

Assess Risk

Check Volatility and Risk Analysis for candidates. Understand beta, drawdown history, and tail risk before committing capital.

4

Deep Dive & Track

Use the Stock Analyser for detailed analysis. Add promising stocks to your Watchlist and monitor with Tracker.

Key Concepts

Relative vs Absolute Performance

A stock down 5% when the market is down 20% is actually a strong relative performer. QuantVec focuses on relative strength because it often persists and predicts future returns.

Statistical Significance

Not every price move matters. Z-Scores help identify when a move is statistically unusual (outside normal variation) vs. random noise. Focus on Z > 1.65 for meaningful signals.

Risk-Adjusted Returns

High returns mean nothing without context. A 50% return with 60% drawdown is poor risk management. MQS and Sharpe Ratio help identify quality returns - high reward with controlled risk.

Market Breadth

Healthy markets have broad participation. When indices rise but few stocks make new highs, it's a warning sign. Market Strength tools help monitor this divergence.

Glossary

Return Metrics

Absolute Return — The total percentage gain or loss of an investment over a period, without comparing to any benchmark.
Relative Return — Performance compared to a benchmark or other stocks. A stock can have negative absolute return but positive relative return if it fell less than the market.
Log Return — Natural logarithm of (Current Price / Previous Price). Preferred for statistical analysis as it's time-additive and normally distributed.
CAGR — Compound Annual Growth Rate. The smoothed annual return that would produce the same total return over the period.
Alpha — Excess return above what would be predicted by beta exposure to the market. Positive alpha indicates skill or edge.

Risk Metrics

Volatility — Standard deviation of returns, usually annualized (daily std × √252). Measures the dispersion of returns around the mean.
Beta — Sensitivity to market movements. Beta of 1.5 means the stock moves 1.5% for every 1% market move. Calculated as Cov(Stock, Market) / Var(Market).
Drawdown — Percentage decline from the most recent peak. A stock at ₹80 that was at ₹100 peak has a 20% drawdown.
Max Drawdown — The largest peak-to-trough decline over a period. Key measure of downside risk.
Sharpe Ratio — (Return - Risk-free Rate) / Volatility. Measures risk-adjusted return. Higher is better; above 1 is good, above 2 is excellent.
Sortino Ratio — Like Sharpe but only penalizes downside volatility. Better for asymmetric return distributions.
Value at Risk (VaR) — Maximum expected loss at a given confidence level (e.g., 95% VaR of 5% means 95% of the time, daily loss won't exceed 5%).

Statistical Measures

Z-Score — Number of standard deviations from the mean: (Value - Mean) / Std Dev. Z > 2 or Z < -2 is statistically significant (95% confidence).
Percentile Rank — Percentage of observations that fall below a given value. 90th percentile means better than 90% of the sample.
Pearson Correlation — Measures linear relationship between two variables (-1 to +1). Sensitive to outliers.
Spearman Correlation — Rank-based correlation. More robust to outliers and non-linear relationships than Pearson.
R-Squared (R²) — Coefficient of determination. Percentage of variance explained by the model (0-100%). R² of 0.7 means 70% of stock movement is explained by market.
Kurtosis — Measures 'tailedness' of distribution. High kurtosis (>3) means fat tails - more extreme events than normal distribution predicts.
Skewness — Measures asymmetry of distribution. Negative skew means more extreme losses than gains; positive skew means more extreme gains.

Momentum & Trend

Momentum — Rate of price change. Typically measured as return over a lookback period (e.g., 12-month momentum).
Relative Strength — How a stock performs compared to others over the same period. Foundation of cross-sectional analysis.
MQS (Momentum Quality Score) — Proprietary metric combining momentum with risk adjustment. Rewards high returns with low drawdowns.
Breakout — When price moves above resistance or below support with increased volume. Often signals trend continuation.
Mean Reversion — Tendency of prices to return to average over time. Extreme Z-scores often revert.
Trend Following — Strategy that buys assets showing upward momentum, assuming trends persist.

Market Structure

Market Cap — Total market value: Share Price × Shares Outstanding. Mega (>₹2L Cr), Large (₹50k-2L Cr), Mid (₹10k-50k Cr), Small (<₹10k Cr).
Market Breadth — Measure of how many stocks participate in a market move. Healthy rallies have broad participation.
New Highs/Lows — Count of stocks making new 52-week (or other period) highs or lows. Key breadth indicator.
Sector Rotation — Movement of capital between sectors based on economic cycle or market conditions.
Liquidity — Ease of buying/selling without impacting price. Higher volume = more liquidity.

Methodology

Detailed explanation of how key metrics are calculated and how to interpret them.

Z-Score Momentum

Measures whether current momentum is statistically unusual compared to historical behavior.

Z = (Current Momentum - Mean Momentum) / Std Dev of Momentum

Parameters

Momentum Window: 21 days (Month), 63 days (Quarter), 252 days (Year)
Lookback Window: 126 days (6M), 252 days (1Y), 756 days (3Y)

Interpretation

Z > +2.0 Unusually strong momentum (top ~2.5%)
Z > +1.65 Statistically significant strength (top ~5%)
-1.65 < Z < +1.65 Normal range
Z < -1.65 Statistically significant weakness
Z < -2.0 Unusually weak momentum (bottom ~2.5%)

Cross-Sectional Percentile

Ranks all stocks by return at a point in time to identify relative winners and losers.

Percentile = (Number of Stocks with Lower Return / Total Stocks) × 100

Parameters

Lookback Period: 252 days (1Y), 504 days (2Y), 756 days (3Y), 1008 days (4Y)
Return Type: Log returns for accuracy

Interpretation

90-100 Top decile performers - strong relative strength
70-90 Above average - outperforming most stocks
30-70 Average performers - in line with market
10-30 Below average - underperforming most stocks
0-10 Bottom decile - significant underperformance

Beta Calculation

Measures systematic risk - how much a stock moves relative to the market index.

Beta = Covariance(Stock Returns, Market Returns) / Variance(Market Returns)

Parameters

Market Index: Nifty 50
Calculation Window: Rolling 252 days
Return Frequency: Daily returns

Interpretation

Beta > 1.5 High beta - significantly more volatile than market
1.0 < Beta < 1.5 Moderate beta - somewhat more volatile
Beta ≈ 1.0 Moves with the market
0.5 < Beta < 1.0 Defensive - less volatile than market
Beta < 0.5 Low beta - much less volatile, or uncorrelated

Correlation Analysis

Measures the relationship between stock returns and market returns.

Pearson: Σ[(x-x̄)(y-ȳ)] / √[Σ(x-x̄)² × Σ(y-ȳ)²]

Parameters

Correlation Types: Pearson (linear), Spearman (rank-based)
Window: Rolling calculation with multiple periods

Interpretation

r > 0.7 Strong positive correlation - moves closely with market
0.3 < r < 0.7 Moderate correlation
-0.3 < r < 0.3 Weak/no correlation - independent movement
r < -0.3 Negative correlation - tends to move opposite to market

Drawdown Analysis

Tracks decline from peak to measure downside risk.

Drawdown = (Peak Price - Current Price) / Peak Price × 100

Parameters

Peak Reference: 52-week high, All-time high, or rolling peak
Analysis Periods: 3M, 6M, 1Y, 2Y views

Interpretation

0-10% Near highs - minimal pullback
10-20% Normal correction territory
20-30% Significant correction
30-50% Bear market for the stock
> 50% Severe decline - potential distress

Volatility & Kurtosis

Measures price dispersion and tail risk.

Volatility = Std Dev(Daily Returns) × √252 (annualized)

Parameters

Calculation Window: 21 days, 63 days, 252 days
Kurtosis: Excess kurtosis (normal = 0)

Interpretation

Vol < 20% Low volatility - stable price movement
20-40% Moderate volatility - typical for equities
40-60% High volatility - significant swings
> 60% Very high volatility - speculative

Features Reference

Momentum & Ranking

Z-Score Momentum

/zscore →

Identifies stocks with statistically significant momentum - moves that are unusual compared to their own history. Useful for finding emerging trends.

momentumstatisticalsignals

Cross-Sectional Analysis

/crosssectional →

Ranks all stocks by return over selected periods (1Y-4Y). Percentile rankings help identify relative winners regardless of absolute market direction.

rankingrelativepercentile

MQS Rankings

/mqs →

Momentum Quality Score combines return with risk adjustment. Rewards stocks with high returns and low drawdowns - quality momentum.

qualityrisk-adjustedmomentum

New Highs

/newhigh →

Stocks making new 52-week highs. Strength indicator - stocks at highs often continue higher (momentum persistence).

breakoutstrengthhighs

New Lows

/newlow →

Stocks making new 52-week lows. Can indicate distress or potential value opportunities depending on context.

weaknesslowswatchlist

Data & Updates

Data Sources

Price Data
NSE and BSE official exchange feeds
Corporate Actions
Dividends, splits, bonuses adjusted in historical prices
Fundamentals
Market cap, sector, industry classifications

Coverage

Stocks Covered
2000+ actively traded companies
Historical Depth
Up to 10 years of daily data
Index Data
Nifty 50, Nifty 500, sectoral indices

Update Schedule

Daily Data
Updated after market close (~4:30 PM IST)
Metrics Calculation
Recalculated daily post-market
Corporate Actions
Applied on ex-date automatically

Limitations

Survivorship Bias
Delisted stocks removed from analysis
Look-ahead Bias
All metrics use point-in-time data, no future information
Data Gaps
Stocks with insufficient history excluded from certain metrics

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Stock analysis and screening tool

All information is provided "as-is" for informational purposes only, not for trading or financial advice.

This platform provides statistical analysis and quantitative research tools. All outputs are for informational and educational purposes only. This is not investment advice. Users should conduct their own research and consult with qualified financial advisors before making investment decisions.

Disclaimer: Trigarth Systemagic Pvt Ltd does not warrant the accuracy or completeness of the data provided. Use at your own risk.

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