Visualizing Financial Data

Chapter 2 Benefits of Using Visual Methods

Communicating with data visualizations is not just about being more effective by replacing text and numbers. A thoughtfully crafted visualization increases our understanding of the data. It reveals patterns, quantities, changes over time, or recurring themes at a glance. It makes data so much easier to comprehend that it can elicit “aha” moments, instant epiphanies, from your audience. Fellow theoretical physicist John Wheeler attributed to Albert Einstein the statement, “If I can’t picture it, I can’t understand it.” Einstein’s quote advocates for the use of visual aids to create understanding. He understood the power of a visual and used drawings and charts throughout his notebooks to explain his observations and formulas.

What types of challenges can data visualizations of charts and graphs address? What are the inherent qualities of a chart and how can we leverage them? This chapter covers these questions as we address the overall benefits of data visualizations.

The Purpose of Charts

You can rely on data visualizations to see outliers, trends, correlations, and patterns. First, consider the case of outliers in the data. An exception report identifies instances in which some threshold was breached. Let’s say these data points or outliers are the focus of interest. Maybe they show errors in a system to highlight specific work to ...