Room for Pie?
Just the other day, I received the latest copy of the Fidelity Investor’s Quarterly magazine in the mail. You can see the same chart below if you click on the link and scroll to page - P2. After dinner, I was reading through the articles when I happened upon this data visualization (shown below). At first, I was drawn to the amount of pie charts that fit inside one line graph. It’s no secret that I avoid pie charts like the plague. However, I found myself thinking that this was a pretty crafty use of pies to show the parts of the whole that made up each asset allocation mix.
In retrospect, I’m almost ashamed that my first thought was that this may be a good use for pie charts. That is until I started trying to figure out which shade of green matched to bonds and which to cash. I found that as my eyes moved across the line graph towards aggressive, I quickly forgot the color for bonds and domestic stocks. The cross reference between the legend and pie charts while trying to follow the line graph was not working too well. Also, don’t forget that the more you move away from zero on the x-axis and y-axis, the more risk and return are expected.
Feeling frustrated, yet challenged, my brain started to churn through designs that would work better for this given data set. My first thought was, keep the line graph and add a bar chart for the mix of investments making up the allocation matrix. A stacked bar would work just fine. Then I recalled a recent post I wrote detailing how ineffective stacked bar charts are for making a comparison.
My next option was to just add a simple 4-row table below the line graph that plainly listed the percentages for the four different investment options. That would have worked, but I knew there must be something more effective. Then the light bulb went off. I remember seeing a similar example on Stephen Few’s website under the examples section found here.
Finally, I found a better alternative and off to Excel I went. Below, you will see my version of Stephen’s design with a few minor changes using this data. This design, using bar charts instead of pie charts, makes it much easier and faster to compare the six different asset allocation strategies. Some of the formatting is a little bit off due to converting the Excel workbook to a .jpeg file. Since some of the numbers are a little hard to read, I have included a link here to the Excel version. Just when I think there may be room for pie, I quickly dismiss the notion.
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