A.I.M. Users Bulletin Board

[ls7550]

Hi Allen. Yahoo adjusted close prices reflect splits and (excepting indexes) dividends i.e. is more reflective of a total returns (accumulation gain assuming dividends were being reinvested). That's as though dividends were being progressively added day by day rather than jerkier price drops on x-dividend date.

If you use the standard 'close' (or open) prices then you need to add dividends to cash as and when they were paid. I suspect that if you did that then your two examples would more closely align.

MORL is a leveraged REIT (?) and REIT's tend to pay relatively high yields. Borrowing to buy twice as much (as the leveraged version in effect does) amplifies those dividends.

By the time you use standard close price and add dividends to cash ...etc overall you'll likely see much the same result as having used the simpler choice of adjusted close figures (as though you'd had dividends automatically reinvested).

In some respects a bit like running AIM with no adjustment for cash interest compared to adjusting AIM cash to include interest. For total returns its easiest to use adjusted close and increase AIM cash by what SHY or whatever earns (or the return from whatever cash might be invested/deposited in).

Clive.