Comparing contribution on charts

If one has a holding of stockas indicated by the chart we have used earlier, what else would one want to know or do with the information.

One of the things I may want to know is how the composition of my portfolio has changed over the priod tracked, i.e. I had allocated a certain percentge of my investments to each of the three shares on 1st January, 2011, based on my risk perception and judgment. Do the values of the three shares held reflect an altere situaion n 1st January, 2012?

How do we do that ?

Before we create a Chart, let us update the data table to reflect the value of holdings.

For this, let us assume that we hold 100 shares of each of the three companies.

The data table, then, will look like :

Date	Tata Motors	Unitech	ITC	Total
01-Jan-11	6000	7600	19000	32600
01-Feb-11	7000	7000	20000	34000
01-Mar-11	8000	6500	20200	34700
01-Apr-11	9000	6500	20200	35700
01-May-11	12000	5600	19000	36600
01-Jun-11	11000	4100	17600	32700
01-Jul-11	15000	3200	17600	35800
01-Aug-11	17000	1900	18000	36900
01-Sep-11	20000	1800	19900	41700
01-Oct-11	20000	2000	21000	43000
01-Nov-11	20000	2500	22000	44500
01-Dec-11	23000	3200	23000	49200

What are the options now ?

Let us try a Stacked Bar Chart.

It might look like :

Oops! Looks like we selected the entire set of data. The purple bar showing totals is also appearing on the Chart.

Do we need it ?

Probably no, because we are trying to establish the proportion of value of holdings between the three shares. The total is only a derivative.

Taking the total column out, the Chart now looks like :

Does this reflect the composition of valuen of holdings over the tracked period ?

I will say it does.

Is there a better way of showing this movement ?

I will say there is.

What is that better way ?

A Line Graph can also be smart

In the last post (apologies to Ford Madox Ford), we selected a Line Graph over a Bar Chart to represent a movement in values over a period of time.

Our graph looked like :

The above Graph clearly shows a comparative picture of the movement of three values over a period of time. It shows that from a simlar starting point, one share has appreciated over the tracked twelve-month period whereas another one has depreciated over the same period. A third share tracked on the same chart has remained within a range.

Who will be interested in presenting the above picture ?

The person / team representing the data that has performed well over the period tracked will have the greatest interest in presenting this data. Hence, in our example, if apreciation in value is the desired objective, the person / team representing Tata Motors would like to present the data in the above format at every opportunity.

Somewhat akin to histoy being written by the victors.

So what would the person / team representing Unitech, where there has been a depreciation in value, do ? Do they just present the data as shown in the graph above, and open themselves up to jibes and criticism about their performance ?

While data remains the same, and their poor performance cannot be airbrushed away, they do have an option of softening the blow.

This can be done through us of the "scaling" facility available in Excel.

Instead of the Y axis being automatically fixd at 250 by Excel, if they make the scale longer and manually fix it at a larger number, say 1250, the resultant graph will look like :

This makes the lines seem closer together and their own line a lot flatter than it was in the earlier graph.

This is not to be mistaken or confused with fudging of data or using incorrect data. Fudging of data or using incorrect data is not permissible under any circumstances.

If performance is poor, it still stays poor. This is only a way in which the conversation can be opened and relevant points made, rather than the conversation being hijacked by the negative slope of the line in the graph.

The vanquished may also get to write some history.

Data Presentation

The table provides notional stock value movemets over a year of three companies.

Note : These are not the actual movements ad hece should not be taken as performance of companies whosenames hav been used. These numbers have been populated purely for the purpose of conceptual understanding of Chart types.

Date	Tata Motors	Unitech	ITC
01-Jan-11	60	76	190
01-Feb-11	70	70	200
01-Mar-11	80	65	202
01-Apr-11	90	65	202
01-May-11	120	56	190
01-Jun-11	110	41	176
01-Jul-11	150	32	176
01-Aug-11	170	19	180
01-Sep-11	200	18	199
01-Oct-11	200	20	210
01-Nov-11	200	25	220
01-Dec-11	230	32	230

If you were asked to represent the movement pictorially (graphically) how would you go about doing it ?