Just as numerical data can be presented in a histogram, categorical data can be presented in a bar chart. The length or height of each bar represents the frequency of observations in that category.
We previously gave the frequency distribution for the stocks in the Dow Jones Industrial Average by sector. We can also show that data as a bar chart.
Bar charts present a snapshot comparing categories of data. The sector with the most Dow components is information technology, followed by consumer staples, financials, healthcare, and industrials.
We can also present a grouped bar chart to illustrate multiple variables. The contingency table of the Dow Jones stocks sorted by both sector and market capitalization can be presented in this way.
By using this chart we can see that information technology is the only sector that has companies with market capitalization exceeding 1 trillion, and that energy and materials companies are all smaller than 250 billion.
Alternatively, the same data can be presented as a stacked bar chart, where the subgroups of each category are stacked on top of each other. This preserves the relative size of the category while also showing the distribution.
