Author
Listed:
- Carreras Simó, Miquel
(Department of Business Studies. University of Girona)
- Coenders, Germà
(Department of Economics, Faculty of Economics and Management. University of Girona)
Abstract
Financial ratios are often used in principal component analysis and related techniques for the purposes of data reduction and visualization. Besides the dependence of results on ratio choice, ratios themselves pose a number of problems when subjected to a principal component analysis, such as skewed distributions. In this work, we put forward an alternative method drawn from compositional data analysis (CoDa), a standard statistical toolbox for use when data convey information about relative magnitudes, as financial ratios do. The method, referred to as the CoDa biplot, does not rely on any particular choice of financial ratio but allows researchers to visually order firms along the pairwise financial ratios for any two accounts. Non-financial magnitudes and time evolution can be added to the visualization as desired. We show an example of its application to the top chains in the Spanish grocery retail sector and show how the technique can be used to depict strategic management differences in financial structure or performance, and their evolution over time. || Las ratios financieras se utilizan a menudo en el análisis en componentes principales y técnicas relacionadas con el fin de reducir y visualizar los datos. Además de la dependencia de los resultados de la elección de las ratios, las ratios en sí plantean una serie de problemas cuando se someten a un análisis de componentes principales, por ejemplo, distribuciones asimétricas. En este trabajo, presentamos un método alternativo que proviene del análisis de datos composicionales (CoDa), una caja de herramientas estadística estándar para usar cuando los datos contienen información sobre magnitudes relativas, como lo hacen las ratios financieras. El método, conocido como el biplot CoDa, no se basa en una elección particular de ratios financieras, sino que permite a los investigadores ordenar visualmente las empresas a lo largo de las ratios financieras entre cualesquiera pares de cuentas. Las magnitudes no financieras y la evolución temporal se pueden agregar a la visualización como se desee. Mostramos un ejemplo de su aplicación a las principales cadenas de supermercados españolas y mostramos cómo la técnica puede utilizarse para describir las diferencias de gestión estratégica en la estructura o el rendimiento financieros, y su evolución en el tiempo.
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JEL classification:
- C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
- M49 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Other
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