Do you want to start tracking stock performance and analyzing fundamental stock trends but don't know how to get started? Have no fear! In this guide, we will show you how to build powerful stock chart visualizations in Excel. As a result, you'll be able to analyze stock financials, key metrics, track real-time price data, and more in no time!
What are stock charts, and why are they important for investors and traders?
Stock charts are graphical representations of stock metrics such as price or revenue movement over time. They are important for investors and traders because they provide a visual way to track stock performance and identify stock trends.
Stock charts can be used to track stock price movement over time, identify potentially undervalued stocks, and make informed investment decisions.
The different types of stock chart visualizations in Excel
There are many different types of stock charts in Excel, but the most common ones are line charts, bar charts, pie charts, and candlestick charts. Each chart has its advantages and disadvantages, but line charts are the most basic and easiest to understand.
Line charts show stock key metric movement over time by plotting stock that metric, such as price or revenue on a line. They are easy to understand and can be used to identify stock trends.
Bar charts show stock key metric movement over time by plotting a metric like net income over time. They are more complex than line charts but can provide more detailed information.
Candlestick charts show stock key metric movement over time by plotting stock prices as candlesticks. They are more complex than bar charts but can provide more detailed price information.
Examples of effective stock charts in Excel
Now that we've gone over the different stock chart types, let's look at some examples of effective stock charts in Excel.
This bar chart from Google Wisesheets shows Alphabet (GOOG) revenue, gross profit, and operating income over time:
This candlestick chart from Wisesheets shows Apple (AAPL) stock price movement over time:
This line chart from Wisesheets shows Amazon (AMZN) stock revenue growth compared with the operating expense growth over time:
You can get all these visualizations for over 50 thousand companies worldwide in your Excel or Google Sheet spreadsheet by creating a free Wisesheet account and downloading the "hypercharts" template available on the Wisesheets add-in. Simply change the ticker and watch all the charts update.
How to read stock charts
Now that we've gone over the different types of stock charts and seen some examples let's take a look at how to read them.
Stock charts can be read in two ways: absolute and relative. Absolute stock charts show stock metrics like price or revenue on an absolute scale, while relative stock charts show metric movement relative to another stock metric like the S&P 500 index.
To read a stock chart, start by looking at the x-axis to identify the time period that is being shown. Then, look at the y-axis to identify the stock metric that is being plotted. Finally, look at the stock price or other metric plot to identify stock trends.
For example, this line chart shows Alphabet (GOOG) stock price movement over time:
The x-axis shows that the stock prices are plotted from August 4th, 2022, to September 2nd, 2022. The y-axis shows that the stock prices are plotted on a scale of $100 to $125. And finally, we can see that the stock price increased from $111 to $118 in this period.
In this example, the chart shows positive stock price growth over this time frame.
Tips for creating powerful and informative stock chart visualizations
Now that you know the basics of stock charts and the different types of stock chart visualizations, it's time to learn how to create powerful and informative stock chart visualizations. Here are some tips:
- Identify the type of analysis: depending on your investment style, you can choose the type of stock chart that best helps you with your analysis.
- Use multiple metrics: don't just track stock price movement, also track other stock metrics such as volume or revenue. This will give you a more comprehensive view of stock performance.
- Use different time frames: don't just track stock performance over the past year, also track it over the past month or week. This will help you identify short-term and long-term stock trends.
- Add annotations: add notes to your stock charts to explain what's happening or why you're making a particular investment decision. This will help you remember your thoughts and make better investment decisions in the future.
- Don't just use stock charts: Use stock charts in conjunction with other research on the stock for better results such as financials, market research, management team, etc. (Learn more here).
Following these tips, you'll be well on your way to creating powerful stock chart visualizations that will help you track stock performance and make informed investment decisions. So what are you waiting for? Get started today!
Stock charts are a powerful tool that can help you visualize stock data and identify stock trends. However, there are many different types of stock charts, each with its own advantages and disadvantages.
To create powerful stock chart visualizations, you need to understand the different types of stock charts and how to read them. You also need to know how to use multiple metrics, different time frames, and annotations.
Following these tips, you'll be well on your way to creating powerful stock chart visualizations that will help you track stock performance and make informed investment decisions.
What type of stock chart do you find most useful for your analysis? Let us know in the comments below!