Comments on: Worst Bear Markets Since 1900 [Chart Review]

By: DSA Insights » Blog Archive » Earnings Chart Labels [Chart Review]

DSA Insights » Blog Archive » Earnings Chart Labels [Chart Review] — Mon, 23 Feb 2009 12:34:18 +0000

[...] in November, I wrote a chart review post that discussed the column chart below, which appeared in BusinessWeek. The criticism I had [...]

By: Chris

Chris — Fri, 28 Nov 2008 18:04:20 +0000

I quite liked the chart – only improvement for me would have been to put the bars in chronological order. It is coincidence (or timing) that the current bear market is at the right. (In fact that caused me to at first think that it was in chronological order until I looked more closely at the bar labels) In chronological order I would still be able to see the worst and future updated versions will allow the author to keep the current data on the right, which I think is the best place for it. The duration in days is particular effective.

By: Jon Peltier

Jon Peltier — Thu, 27 Nov 2008 13:44:54 +0000

The timeline has some benefits. It slows comprehension when the dated points are not in chronological order. If thee timeline weree to scale, though, it would be hard to emphasize the ten worst ___ (any events) over a 100-year period, when the duration of these events ranges from 0.2 to 2 years.

That’s another point, the percentages are interesting, but a higher percentage in a shorter time indicates a steeper drop.

I’ve seen timelines which have (for example) the market capitalization over time, where certain periods were highlighted. You could shade the area under the timeline to indicate bear markets, and use a darker highlight for the ten worst. This would show duration without much resolution, ad well as steepness and cumulative drop. Add a data label to the shaded regions you want to emphasize.

By: Tony

Tony — Thu, 27 Nov 2008 00:50:24 +0000

@Jon, I’m not sure I can agree on the positive percentages. I can’t say that everyone would know what a bear market means and using positive percentages could cause more confusion. I think if you just flip the data showing duration to be at the top, the visual is much easier to quickly understand.

Here is a different idea that may be a little impractical. What about creating a simple line graph from 1900 to present that has time on the x-axis and percentage on the y-axis. Below the line graph, could be a horizontal bar chart showing duration – kind of a stacked bar with white space in between the 11 data points above. It would take more space to accomplish and I’m not sure you would gain much over this version. However, you would be able to see the entire picture.

Yes, the red column is definitely not too subtle, but really pops out at you. Most of the examples I’ve seen using this method, use a light gray for the whole series and a darker gray for the one to stand out.

Thank you for the comment!

By: Jon Peltier

Jon Peltier — Wed, 26 Nov 2008 22:50:32 +0000

Even though each bar represents a loss, I would probably plot positive percentages. This allows the duration to stay in the less emphasized position under the bars.

At first the white space between the bars and duration boxes looked like the data, but I think making the bars narrower and increasing the white gap between them will avoid this misperception.

Finally, it’s good to use a different color to highlight a specific bar, but I think the red they chose was too vivid. A darker gray would have been sufficient.