I am trying to calculate the total return of a mutual fund over a period of time that included numeous dividend payments. I am using the following, but it does not appear to be correct. [(Ending Price) - (Adjusted Close on day of purchase)] / (Adjusted Close on day of purchase) Is it even possible to calculate the total return using the adjusted closing price found on Yahoo Finance?
What’s “Adjusted Close”?
Found in Yahoo Finance historical prices. The adjusted close price is the close price adjusted for dividends and splits. http://finance.yahoo.com/q/hp?s=SPY+Historical+Prices
Were the dividends/cap gains reinvested into the fund?
Chuckrox8 Wrote: ------------------------------------------------------- > Were the dividends/cap gains reinvested into the > fund? Yes, dividends/cap gains reinvested.
why can’t you use the unadjusted closing prices and sum all the dividends paid instead of working with adjusted prices
Mobius Striptease Wrote: ------------------------------------------------------- > why can’t you use the unadjusted closing prices > and sum all the dividends paid instead of working > with adjusted prices You are right, I could do this, however I am currently using an macro that is going to Yahoo Finance and pulling the historical prices into Excel for a given date range that I specify in Excel. The dividend lines in Yahoo historic prices are not extracted. This leaves me in Excel with date, open, high, low, close, vol and adj close. I was hoping that I could use the adjusted close to build a cumulative, total return line chart for any fund I specify.
yahoo’s adjustments are kind of bizarre, they return from the adjusted prices is not equal to the total return. see details on the adjustments here: http://help.yahoo.com/l/us/yahoo/finance/quotes/quote-12.html you need the dividend info which is very easy to extract with that same macro you are using, just need to change the last few words in the Yahoo historical stock price URL to “&g=v”
Find a Bloomberg terminal and use the TRA function.
Thank you to everyone. I will pull out the dividends using closing prices.