Principles of Finance · free preview
Visualizing Financial Data
Charts reveal patterns tables conceal, and the working toolkit, line charts for time series, histograms for distributions, and scatter plots for relationships, serves every analytical task in finance when drawn honestly.
1. Why visualize at all
Why visualize at all
2. The honesty checklist
The honesty checklist
3. Reading financial pictures
Reading financial pictures
4. Visualization in the workflow
Visualization in the workflow
5. Matching chart to question
Which chart matches the analytical question correctly?
6. The truncated axis
A chart of quarterly profits shows the vertical axis running from 48 million to 52 million. What does this design do?
7. The cumulative chart's trick
Why can a cumulative return chart mislead about a strategy's risk?
8. Volatility clustering in the picture
A line chart of monthly returns shows calm stretches alternating with violent swings. What is this pattern called, and why does it matter?
9. Reading beta from a scatter
A scatter plot of a stock's returns against the market's shows a cloud tilting upward. What is the visual telling you before any regression runs?
10. The first audience for the checklist
According to the lesson, who is the first person the chart honesty checklist should be applied to?
11. The relationship chart
What one-word term names the chart that pairs two variables to expose their correlation? Answer in lowercase.
12. The distribution chart
What one-word term names the chart that bins observations to display a distribution's shape? Answer in lowercase.
13. The three-chart toolkit
What three-word phrase names the lesson's trio of workhorse charts? Answer with three words.
14. The bunched-volatility pattern
What two-word term names the tendency of large return moves to arrive in clusters? Answer in lowercase.
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