Now the issue here is, when company pays out dividends, the stock price reduces by approximately that much amount.
I am developing strategies where I need total return of the stocks for past many years. If dividends are not added to close prices, how am I supposed to calculate total returns of the stock? Because of this, there will be anomalies in the strategies.
If dividends are not added to prices, what is the purpose of having historical data? Since historical data is generally used for developing strategies and algo treading.
@rakeshr , From the thread you mentioned, it's not clear whether the dividend prices are added to the adjusted stock price or subtracted? From the link I mentioned in the question: https://kite.trade/forum/discussion/4014/is-historical-data-dividend-adjusted It seems that they would be subtracted from the stock price automatically by the markets and adjustments are not required by Zerodha.
But I think dividend should be added to the price so that we can have an idea of total returns of the stock.
But I think dividend should be added to the price so that we can have an idea of total returns of the stock.