What is Line Chart and When to Use It

A Line Chart or Line Graph is the most popular type of the data visualization. It displays information as a series of data points called 'markers' connected by straight line segments. Usually, a Line Chart shows a dynamics of the displayed value in time (in case of Cartesian Chart) or by X (in case of Scatter Chart).

The following line chart shows the Moody's Corporate Bonds yields for Baa and Aaa corporate bonds.

We can also present the same chart as a spline, which consists of a set of points connected with a curve. Notice that the data points are connected with a fitted curve instead of straight lines.

When to use it

The line chart is primarily suitable when you want to visualize trends and movements over time, where the dimension values are evenly spaced, such as months, quarters, or fiscal years.

Your data set must consist of at least two data points to draw a line. A data set with a single value is displayed as a point.

Advantages

The line chart is easy to understand and gives an instant perception of trends.

Disadvantages

Using more than a few lines in a line chart makes the line chart cluttered and hard to interpret. For this reason, avoid using more than two or three measures.

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Data Science in Finance: 9-Book Bundle

Data Science in Finance Book Bundle

Master R and Python for financial data science with our comprehensive bundle of 9 ebooks.

What's Included:

  • Getting Started with R
  • R Programming for Data Science
  • Data Visualization with R
  • Financial Time Series Analysis with R
  • Quantitative Trading Strategies with R
  • Derivatives with R
  • Credit Risk Modelling With R
  • Python for Data Science
  • Machine Learning in Finance using Python

Each book comes with PDFs, detailed explanations, step-by-step instructions, data files, and complete downloadable R code for all examples.