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11-02-2009, 09:11 AM
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#1
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Recycles dryer sheets
Join Date: Oct 2002
Posts: 80
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Very dumb question
When I look at "YTD Return" on Yahoo MF quote, does that return include dividends or does it just reflect the change in market price?
I thought it included any dividends, but got confused when researching VFIAX. I know I'm making a very basic mistake here, so please help me out.
The price of VFIAX on 12/31/08 was $81.60, on 9/30/09 it was $97.45 or a 19.42% increase in share price. During that same period VFIAX also paid out $1.51 in dividends or 1.8%. That would make the total return on 21.22%.
Looking at the S&P over the same period it increased by only 17.03% (903.25 to 1057.08). That's a 4.19% difference! Now I know the S&P didn't pay out 4+ % dividend and VFIAX can't be beating the index by that much. What am I missing?
Thanks in advance for setting me straight.
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11-02-2009, 02:07 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2006
Posts: 7,733
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Not a dumb question at all. As best I can determine most of the free resource on the net do include dividends when calculating "returns". However, there are many exceptions which just include share price growth.
Also if you ever talk to an equity index annuity salesman they almost never will include dividends
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11-02-2009, 07:10 PM
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#3
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Thinks s/he gets paid by the post
Join Date: Jul 2005
Posts: 4,366
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It's really togh to find a good source of total returns, especially as a chart.
Morningstar lists total returns, which will include reinvestment of dividends and capitial gains. You can guess a little at Yahoo if you look at the "adjusted" historical prices for MF's, but they have not been reliable in my experience, perhaps including only dividends and not capital gains or just missing a distribution.
You can also get total return data from Fidelity, though it's usually just 1, 3, 5, 10 year numbers.
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11-02-2009, 09:59 PM
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#4
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Recycles dryer sheets
Join Date: Dec 2008
Posts: 299
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Quote:
Originally Posted by moguls
The price of VFIAX on 12/31/08 was $81.60, on 9/30/09 it was $97.45 or a 19.42% increase in share price. During that same period VFIAX also paid out $1.51 in dividends or 1.8%. That would make the total return on 21.22%.
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The price of VFIAX on 12/31/08 was $83.09, not $81.60. If you use the Adj Close and you add $1.51 in dividends, you are double counting the dividends.
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11-03-2009, 08:21 AM
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#5
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Recycles dryer sheets
Join Date: Oct 2002
Posts: 80
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Thanks thefinancebuff, I knew I was overlooking something. You nailed it!
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11-03-2009, 08:34 AM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Maybe it just gets "morphed" into the insurer's cut of the "participation rate" pie.........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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11-03-2009, 11:03 AM
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#7
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Recycles dryer sheets
Join Date: Sep 2009
Posts: 353
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Quote:
Originally Posted by moguls
Thanks thefinancebuff, I knew I was overlooking something. You nailed it!
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Make sure you do NOT use adj. close for calculating total return. That is incorrect.
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