We couldn’t end this topic without addressing charts and graph types, which are extremely crucial to consider when evaluating or presenting financial data. Choosing the correct business graph to showcase your data is similar to capturing a picture and exhibiting it to people; you want it to be clear and focused on what you need to promote a debate. Here are five of the most frequent types of financial charts for visualizing your financial data:
This sort of financial chart is perfect for displaying many series of closely linked data across time, allowing you to see trends, inertial, decelerations, and volatility in your data. This sort of chart is particularly easy to interpret because of its simplified form, which consists of thin lines. To keep it looking like this, keep your axis scales close to your highest data point at all times. This way, you won’t waste essential chart space.
It’s also crucial to think about simply presenting the measurements that are relevant to your study because too many variables might overcrowd the chart and make it difficult to read. Financial KPIs like return on equity, working capital ratio, and earnings before interest and taxes may all be tracked using line charts.
Line charts are one of the most used chart styles. When you have a continuous data set, use lines. These are useful for trend-based data visualizations across time, especially when the number of data points is large (more than 20). The emphasis with line charts is on the continuity or flow of the values (a trend), however single value comparisons using data markers still have some support (only with less than 20 data points.)
When the chart is tiny, a line chart is a reasonable option for a column chart.
A number chart is amongst the simplest forms of business graphs since it is simply a ticker that shows you how a given KPI is performing right now. You only need to select the time period you want to monitor and whether you want to compare it to a trend or a set target, depending on your study’ purpose.
It may be used to track financial metrics such as total cash balance, current assets, and liabilities, as well as sales KPIs such as total revenue. Keeping track of these real-time figures will allow you to see any discrepancies in your financial data early on.
Tables are a classic manner of presenting data, and they may be quite useful when working with raw data. A table can be used to represent a large number of specific measurements and dimensions, with the grand total always available to compare or support them. They’re also beneficial if many persons require access to the data for various reasons since they can filter it and just work with what they need.
Because of their intricacy, you should constantly strive to make your tables as aesthetically appealing as possible in terms of colors and shapes. With the help of a dashboard tool, you can achieve this. Tables may be used in finance to present data from profit and loss accounts (P&L) to gain enhanced insights into your company’s revenues.
The gauge chart is a simple and uncomplicated representation that is frequently used to show the performance of a particular parameter in a quantitative context. This style of chart uses colors and needles to measure the progress of a KPI in relation to a defined target or other time periods.
It’s crucial to remember that gauge charts are excellent for presenting a single parameter, therefore they’re not the best graphic to use if you’re looking for actionable insights from your data. To view the economic value-added and net profit margin displayed with colorful gauge charts, return to our selection of financial graph examples.
A progress chart, as the name implies, is used to keep track of how far you’ve progressed on a given objective and how far you still have to go to fulfill it. You may use circle or bar charts to display the data, and you can also include reference figures to show where you should be in a given time period and compare if you are on track to meet your end objective.
If you want a more in-depth look, you may split down your progress into distinct sections and track each one independently to see if any setbacks are occurring and where they are occurring. In terms of finances, you may use it to track your budget expenditures or the progress of a large project in which your organization has made a significant investment.
Although these five chart types are commonly used to represent financial data, you should always consider the goal of your study and the questions you’re attempting to answer when choosing your visualizations. Here is a helpful summary to assist you in selecting the appropriate sort of business chart based on your objectives.