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The Application of Visual Analytics to Financial Stability Monitoring

Journal of Financial Stability, 2016, Forthcoming

50 Pages Posted: 18 May 2014 Last revised: 14 Jan 2016

Mark D. Flood

Government of the United States of America - Office of Financial Research

Victoria L. Lemieux

University of British Columbia (UBC)

Margaret Varga

University of Oxford

B. L. William Wong

Middlesex University

Date Written: July 30, 2015

Abstract

This paper provides an overview of visual analytics — the science of analytical reasoning enhanced by interactive visualizations tightly coupled with data analytics software — and discusses its potential benefits in monitoring systemic financial stability. The core strength of visual analytics is to combine visualization’s high-bandwidth information channel to the human analyst with the flexibility and power of rapid-iteration analytics. This combination is especially valuable in the context of macroprudential supervision, which is increasingly dominated by large volumes of dynamic and heterogeneous data. Our contribution is to describe and categorize the analytical challenges faced by macroprudential supervisors, and to indicate where and how visual analytics can increase supervisors’ comprehension of the data stream, helping to transform it into actionable knowledge to support informed decision- and policy-making. The paper concludes with suggestions for a research agenda.

Keywords: Financial stability, macroprudential supervision, monitoring, systemic risk, visual analytics

JEL Classification: C80, C88, E44

Suggested Citation

Flood, Mark D. and Lemieux, Victoria L. and Varga, Margaret and Wong, B. L. William, The Application of Visual Analytics to Financial Stability Monitoring (July 30, 2015). Journal of Financial Stability, 2016, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2438194 or http://dx.doi.org/10.2139/ssrn.2438194

Mark Flood (Contact Author)

Government of the United States of America - Office of Financial Research ( email )

717 14th Street, NW
Washington DC, DC 20005
United States

Victoria Lemieux

University of British Columbia (UBC) ( email )

2329 West Mall
Vancouver, British Columbia BC V6T 1Z4
Canada

Margaret Varga

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

B. L. Wong

Middlesex University ( email )

The Burroughs
London, NW4 4BT
United Kingdom

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