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There are two main reasons to use logarithmic scales in charts and graphs. The first is to respond to skewness towards large values. i.e., cases in which one or a few points are much larger than the bulk of the data. The second is to show percent change or multiplicative factors.
A logarithmic price scale is a type of scale used on a chart that is plotted such that two equivalent price changes are represented by the same vertical distance on the scale. The distance between the numbers on the scale decreases as the price of the asset increases.
A logarithmic scale is a nonlinear scale, typically used to display a large range of positive multiples of some quantity, ranging through several orders of magnitude, so that the value at higher end of the range is many times the value at the lower end of the range.
A logarithmic scale is defined as one where the units on an axis are powers, or logarithms, of a base number, usually 10. It is particularly useful when we need to represent large, exponential changes in information on that axis. A semi-log chart is one in which one axis (x or y) is converted to a logarithmic scale.
A logarithmic price scale is a type of scale used on a chart that is plotted such that two equivalent price changes are represented by the same vertical distance on the scale. The distance between the numbers on the scale decreases as the price of the asset increases.
What is difference between Linear and Logarithmic scale? Linear graphs are scaled, so that equal vertical distances represent the same absolute-dollar-value change. The logarithmic scale reveals percentage changes. A change from 100 to 200, for example, is presented in the same way as a change from 1,000 to 2,000.
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