How to Lie with Data | Cherry Picking Data

Key Takeaways

what's going on everybody welcome back to another video in this series I show you how easy it is to manipulate and lie with [Music] data now I don't know about you but when I'm watching the news and it says something like the US is the bigger exporter of this product and it has this little Aster down at the bottom and it says not including Asia and I'm like well that's kind of a big thing to leave out of the data you're basically cherry-picking your data and so in this video I'm going to show you how easy it is to just omit and select the data that you want to easily change and manipulate the data let's not waste any time let's jump onto my screen and take a look all right so let's take a look at this data right here now we have a stock price we have a year and we're taking a look at the stock price over time so we have this nice little line graph and just goes per year here's what we're looking at and so what we can conclude from this is that it peaked in 2018 it's been going down and any body who invest in this is a schmuck because they're losing tons of money I mean it's gone from about 150 down to 90 that's like 30 or 40% of its value and you just you lost money but does this necessarily represent this stock as a home I don't like to invest in stocks for a short period of time I'm just I like to hold it forever I like to hold it for 20 years and so this may not be true for everybody but it's very easy to just look at this and conclude that this is a bad stock and you shouldn't be investing in it you should never invest in it right but let's take a look at the cherry-picked good data and the cherry-picked bad data if we come over here and we take a look we actually have a lot more data this uh stock was listed back in 2011 at $30 and so anyone who invested a long time ago is still making a ton of money from this stock and so now we're representing all of the data going back as far as we can and this is going to give a lot more context to this stock as a whole in this other chart we really have cherry-picked this and all cherry-picking means is that we've intentionally left out some data now sometimes and if I'm being honest that's a perfectly fine thing to do you don't always have to include all the data you can get a little bit too cumbersome but it depends on the narrative and what your end goal is for exploring and looking at this data because as we all know 2020 was not a great year for most stocks and it wasn't a great year for a lot of companies and so if we just look at these years as representative of the stock as a whole it's not going to be as accurate as if we had shown like they've had a really great track record kind of up until 2020 and then their stock took a hit it's very possible that these last few years are an outlier due to some economic conditions they are out of their control but over the long term it could go back up and so cherry picking the data and only showing what you want to show maybe to fit a specific Nar Narrative of oh this is a bad stock to pick you shouldn't invest in this company they well that may be true but it also could just be that you're cherry-picking your data and they actually have really good fundamentals and something happened here that's hurt them temporarily before they kind of before they start coming back and they're a good stock again now just this concept as a whole again I've been dogging the news in this series but I've seen this in the news where they will intentionally omit specific data to fit whatever narrative they're trying to push and I don't want you to be that guy or girl I don't want to be the person who intentionally omits a specific year and just like oh that's not important no the the data is important the data is there for a reason so don't omit or cherry-pick data that you don't want to show just to fit whatever you're trying to do it is much better to represent it as a whole almost all the time so I hope that was helpful don't make this mistake okay just be conscious be aware of this if you like this video be sure to like And subscribe and I will see you in the next one [Music]