Financial terms starting with “Q”

14 terms · plain-language definitions for lifelong students and investors · Full glossary

QBI Deduction (§199A): The Qualified Business Income deduction, created by Section 199A of the tax code, lets owners of pass-through businesses (sole proprietorships, single-member LLCs, partnerships, S-corps) deduct up to 20% of their net qualified business income from taxable income. Below an annual income threshold (directionally around $200,000 single / $400,000 married-filing-jointly at 2026 levels) almost everyone gets the full 20%; above it the deduction phases out or is limited, with tighter rules for certain service businesses. It reduces income tax only, not self-employment tax.
Qualified Dividend: A US tax classification for dividends paid by a domestic corporation (or a qualifying foreign corporation) on stock the investor has held for the required holding period (more than 60 days during the 121-day window around the ex-dividend date). Qualified dividends are taxed at the long-term capital-gains rate (15% for most investors; 20% for top-bracket; 0% for low-bracket) rather than ordinary income rates. Non-qualified dividends (most REIT distributions, MLP distributions, very-short-hold dividends) are taxed at ordinary income.
Qualified Education Expenses: The costs a 529 plan can pay for tax-free: college tuition, mandatory fees, books and required equipment, and room and board within the school's cost of attendance, plus K-12 tuition (up to an annual cap), registered apprenticeship costs, and student-loan repayment (up to a lifetime cap). Spending on anything else makes the earnings portion taxable and subject to a 10% penalty.
Qualified Intermediary: QI. A third party that holds the proceeds of the surrendered property sale in a 1031 exchange and uses those proceeds to acquire the replacement property on the sellers behalf. The QI requirement exists because the seller cannot have constructive receipt of the cash without disqualifying the exchange. The QI is one of the four mechanical pillars of a valid 1031 (alongside the 45-day identification deadline, the 180-day closing deadline, and the equal-or-greater value/debt requirement). Choosing a reputable QI with proper bonding is essential because QI failures have triggered both lost exchanges and outright fraud losses in the past.
Qualified Opinion: An audit opinion stating that except for one specific issue, the financial statements are fairly presented. Common causes include scope limitations (auditor couldn't examine everything) or departures from accounting standards. Investors should understand exactly what the qualification covers.
Quant-Value Discipline: The investment approach of systematically applying a small number of quantitative ranking factors across a wide universe of securities, holding a diversified basket, and rebalancing on a defined schedule -- as distinct from fully discretionary fundamental investing. The discipline trades depth of single-name analysis for breadth of factor exposure, and is most workable for investors whose evaluation horizons match the strategys cycle rather than the typical professional review cycle.
Quantitative Easing: When a central bank buys bonds to inject money into the economy, pushing interest rates down and encouraging borrowing. QE was used extensively after 2008 and 2020 to stimulate economic recovery.
Quantitative Easing (QE): A monetary policy tool where a central bank buys large quantities of bonds to inject money into the financial system, pushing interest rates down and asset prices up. Used during severe economic downturns when conventional rate cuts alone are insufficient. The Federal Reserve deployed massive QE programs after 2008 and again in 2020.
Quantitative Margin of Safety: A screen-level form of Grahams broader margin-of-safety discipline, computed as the spread between a stocks earnings yield and the AAA corporate bond yield. Graham himself argued that defensive investors should typically demand an earnings yield at least double the AAA bond yield. The quantitative test is necessary but not sufficient -- it screens for price-to-current-earnings cheapness without saying anything about business quality, durability, or accounting honesty.
Quantitative Marketability Discount Model: The QMDM framework (Mercer Capital, 1997 onward) for computing DLOM as a cost-of-equity uplift over the expected holding period. Mechanic: take the marketable-equivalent cost of equity, add an illiquidity uplift (typically 300-500 bps), discount the projected cash flows over the holding period at the higher rate, and compare to the discounted-at-marketable-rate present value. The percentage difference is the DLOM. QMDM is the most rigorous practitioner framework because it operationalizes the natural experiment generated by the historical narrowing of restricted-stock discounts when Rule 144 holding periods were reduced.
Quantitative Tightening (QT): When a central bank reduces its bond holdings by allowing them to mature without reinvesting proceeds, pulling money out of the financial system. The opposite of quantitative easing. Quantitative tightening tightens financial conditions and can put upward pressure on long-term interest rates.
Quarterly Report: Same as 10-Q. Public companies file three quarterly reports per year (Q1, Q2, Q3) with the SEC; the fourth quarter is rolled into the annual 10-K.
Quick Assets: Current assets that can be converted to cash within days — cash, cash equivalents, marketable securities, and accounts receivable. Excludes inventory, which may take weeks-to-months to sell. The numerator of the Quick Ratio (Quick Assets / Current Liabilities), which tests whether a company can pay its near-term bills without having to sell inventory.
Quick Ratio: Like the current ratio but excludes inventory, which can be hard to sell quickly. Calculated as (current assets \u2212 inventory) / current liabilities. A more conservative liquidity test \u2014 a ratio above 1.0 means the company can cover short-term bills without selling any inventory.

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