Types of Graphs
List of the top 10 types of graphs for data
List of the top 10 types of graphs for data
Any good financial analyst knows the importance of effectively communicating results, which largely comes down to knowing the different types of charts and graphs, and when to use them. In this guide, we outline the top 10 types of graphs in Excel, and what situation each kind is best for. Learn how to deliver powerful presentations and clear takeaways with these effective chart types. Learn more in CFI’s Excel dashboards course!
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The most common, simplest, and classic is the line graph. The perfect solution for showing multiple series of closely related series of data. Since line graphs are very light-weight (they only consist of lines, as opposed to thinker chart types, as shown further below) they are great for a minimalistic look.
Bars (or columns) are the best types of graphs for presenting a single data series. Bar charts have a much heavier weight to them than line graphs so they really emphasize a point and stand out on the page.
The above two types of graphs can be combined to create a combo chart with bars and lines. This is very useful when presenting two data services that have a very different scale and might be expressed in different units. The most common example is dollars on one axis and percentage on the other axis.
Source: Dashboard Course
The scatterplot is excellent for showing the relationship between two data series and determining their correlation. The scatterplot is great for showing what the distribution of data points looks like and drawing a line of best fit for regression analysis.
Source: Budgeting & Forecasting Course.
In Excel 2016 Microsoft finally introduced a waterfall chart feature. In all older versions of Excel, analysts had to create a custom workaround using stacked column charts. If you are in a version of Excel prior to 2016 please see our free guide and waterfall chart template. The waterfall chart is excellent for variance analysis and explaining how an “actual” result was different than a “budget” or how something has changed relative to an original data point.
Pie charts have a bad reputation and are known for being messy and hard to read. If you’re trying to illustrate the percentage breakdown of a small number of data point they can be very effective. For example, percent of people who prefer bananas, pineapple, and grapes.
Histograms are the types of graphs that show the distribution of a dataset. They graph the percentage or the number of instances of different categories. For example, to show the distribution of age categories (0-10, 11-20, 21-30, etc.) we can clearly see which categories are the biggest and how many people fall into each.
The gauge chart is perfect for graphing a single data point and showing where that result fits on a scale from “bad” to “good”. Gauges are an advanced type of graph as Excel doesn’t have a standard template for making them. To build one you have to combine a pie and a doughnut. Learn how in our data visualization course.
Source: Advanced Excel Course
An area chart is a solid area and can be effective when showing stacked, cumulative data series. For example, showing the cumulative sales revenue from different products. This allows the reader to easily visualize the “area” (or weight) of each series relative to each other.
A spider or radar graph is a very useful type of graph for showing qualitative data or the overall “score” or comparison of multiple series. For example, a spider/radar could be easily used to compare 3 different types of phones based on 5 criteria (speed, screen size, camera quality, memory, apps).
Watch this short video to learn about different types of graphs commonly seen on financial models and dashboards!
This has been a guide to the top 10 different types of graphs you need to perform world-class financial analysis. To keep learning and developing your career, you will find these additional resources helpful:
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