Sankey charts, once considered a bit of a puzzle, have become a powerful tool in the world of financial analysis and flow diagrams. In this article, we’ll take a deep dive into the secrets and applications of Sankey charts.

What are Sankey Charts?
Sankey charts are a type of flow diagram that uses a series of symbols, called Sankey links, to show the movement of financial streams. The main idea behind Sankey charts is to represent the flow of assets and liabilities, as well as the movement of people and information.

The Sankey diagram consists of several basic elements: the flow elements, which represent the components of the financial stream, and a network of lines connecting these elements. The horizontal line at the top of the diagram represents the financial start point, and the bottom line represents the terminal point. The Sankey links act as the connecting arrows between the elements, and they tell us the direction and amount that the flow is flowing in.

A single Sankey chart can be used to represent as many components as required, and its usefulness lies in its ability to show the dynamic nature of financial flows. Sankey charts are often used in financial analysis, to show the movement of capital, assets, and liabilities. Their simplicity and ease of use make them a popular choice for those who need to analyze complex financial flows.

Applications of Sankey Charts
Sankey charts have numerous applications in finance and business. They can be used to analyze the movement of capital, assets, and liabilities, as well as the movement of people and information. Some of their applications include:

1. Financial Analysis: Sankey charts can be used to analyze and visualize the movement of capital, assets, and liabilities. They can help managers identify trends, risks, and opportunities in a variety of industries.
2. Investment Analysis: Sankey charts can be used to analyze the flow of money from one investment to another, as well as the risk of potential losses.
3. Market Analysis: Sankey charts can be used to analyze the flow of capital and assets in a specific market or industry.
4. Risk Analysis: Sankey charts can be used to analyze the risk of potential losses in a financial flow system.

In addition to its financial applications, Sankey charts can be used in the field of marketing and customer service. They can be used to analyze customer flow, to identify areas for improvement and to track customer satisfaction.

Secrets of Sankey Charts
Sankey charts have become popular due to their simplicity and ease of use, as well as their ability to visualize complex financial flows. However, there are some secrets that can make their use even more effective:

1. The choice of symbols: The symbols used in Sankey charts can have a huge impact on their visual appeal and ability to convey the flow of information. It is important to choose symbols that accurately represent the types of financial flows, and to ensure that the symbols are easily recognizable.

2. The arrangement of the flow elements: The arrangement of the flow elements in the Sankey chart can have a significant impact on the flow of information being represented. It’s important to ensure that the flow elements are positioned in a way that allows the flow of information to be easily seen.

3. The use of color: Sankey charts are often color-coded, and color can have a significant impact on the flow of information being represented. This color coding can help to highlight areas of concern or opportunities.

In conclusion, Sankey charts are a powerful tool in the world of financial analysis and flow diagrams. By understanding the basics of the Sankey chart, and by applying the secrets of this flow charting technique, anyone can visualize and analyze complex financial flows with ease.

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