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3/8/2005
Dot Plot of S&P

A very useful way to plot market data is a ordered dot plot. To make a dot plot, place the values on the x axis (not the y axis.) but plot them consecutively 1 at a time on the y axis. Instead of moving in time horizontally,1 box at a time and plotting the values on the y axis, you move 1 at a time vertically and plot the value on the x axis.

For example, starting with the last day of January, the prices of S&P March futures and corresponding changes were:

DateSPH5DiffDateSPH5Diff
1/31/20051181.72/17/20051201-9.5
2/1/20051189.27.52/18/20051202.31.3
2/2/20051193.242/22/20051184.7-17.6
2/3/20051189.6-3.62/23/20051192.78
2/4/2005120212.42/24/20051200.78
2/7/20051200.7-1.32/25/2005121211.3
2/8/20051202.21.52/28/20051204.1-7.9
2/9/20051192.9-9.33/1/20051210.16
2/10/20051196.63.73/2/20051209.6-0.5
2/11/2005120710.43/3/20051209.90.3
2/14/20051206.3-0.73/4/20051224.314.4
2/15/20051210.74.43/7/20051225.31
2/16/20051210.5-0.2

..and the corresponding dotplot:

The value of such a graph is you can see as you move up or down the graph whether the observations tend to get larger or smaller, change in variation, how the slopes change, how the consecutive moves change relative to the vertical (serial correlation), what the normal changes following moves of a given magnitude are, and how the data are skewed. I have never seen a ordered dot plot before, and looking thru the 7,000 references on Google apparently no one has applied this to stock market data although I found an example of this plot in the excellent book Statistical Methods in Psychology by David Howell.