# Do SPY prices include dividends?

I'd like to calculate the return of SPY over a range of time. For example:

``````5/1/18: 264.98
9/14/18: 290.88

264.98 - 290.88 = 25.9
25.9/264.98= 0.0977 = 9.77%
``````

Does the 9.77% return include SPY dividends?

No it does not. Indices that do included dividends in their price should be labelled as "total return" indices.

To be certain, looking at the history on Yahoo, the actual 5/1 closing price of 264.98 was adjusted down for the dividend that occurred on 6/15. So you'd need to increase your ending point by the amount of the dividend (or use the adjusted 5/1 price) to calculate "total return".

Here's an example with your numbers. You already calculated the return from 5/1/18 to 9/14/18 at 9.77%. However, you also received a 1.246 dividend in that period, so your total return is

``````(290.88 + 1.246 - 264.98) / 264.98 = 10.24%
``````

Rather than listing the dividends earned in each period to add to the end price, Yahoo (and other data vendors) instead adjust the beginning price by the amount of dividends paid after that price. So using their adjusted price on 5/1 of 263.80, you could also calculate the return as

``````(290.88 - 263.80) / 263.80 = 10.27%
``````

Note that the return is not exactly the same since the denominator is different, but should be close enough for return comparisons.

• I see they listed the adjusted price, which does not include the dividend right? Doesn't that mean close prices do include the dividend? If that is the case and since I'm using close prices, I should be fine. – 4thSpace Sep 17 '18 at 16:45
• The adjusted price accounts for the dividend. The price of an index drops by the amount of the dividend, so the adjusted price reflects that drop. The closing price represents the actual closing price on that date. Adjusted prices are used to easily calculate total return. – D Stanley Sep 17 '18 at 16:58
• If you are calculating prices off of the adjusted price, you aren't accounting for dividends. How is that total return? Aren't dividends included in total return? – 4thSpace Sep 17 '18 at 17:38
• Think about it this way - if nothing had happened except the dividend, on 6/15 the price would go from 283.73 (actual price) to 277.48 (adjusted price), reflecting a drop in price when in fact the drop was because of a dividend. If you use the adjusted price for 6/14, there would be no price change so your total return would be 0. – D Stanley Sep 17 '18 at 18:02
• @D Stanley - "If nothing had happened except the dividend, on 6/15 the price would go from 283.73 (actual price) to 277.48 (adjusted price)." TYPO ? – Bob Baerker Sep 17 '18 at 21:51

You can use the difference between the 9/14 close and the actual close on 5/01 and add the dividend received.

Or you can use the difference between the 9/14 close and the adjusted close on 5/01.

And if it makes your life any easier, you can use the DRIP calculator at:

https://www.dividendchannel.com/drip-returns-calculator/

• Is that calculator correct? Every time I compare a high dividend index fund (SCHD or SPYD) to the S&P 500 index fund, it always says the S&P 500 index fund had more dividend cash per share reinvested. It seems counter-intuitive that a high dividend index fund does not actually have high dividends. – JoJo Sep 18 '18 at 4:30
• @JoJo: SCHD trades at \$53, SPY at \$289. I expect the latter to pay out a larger dividend in absolute terms, but a smaller one in relative terms. Which are you talking about when you say "more dividend cash per share"? – Ben Voigt Sep 18 '18 at 4:52
• The benchmark for SCHD is the Dow Jones U.S. Dividend 100 Index. The benchmark for SPYD is the S&P 500 High Dividend Index and is designed to measure the performance of the top 80 dividend yielding securities. You're comparing apples and oranges. – Bob Baerker Sep 18 '18 at 12:07
• That's the problem with these calculators and why I'm trying to do it manually but no one knows. – 4thSpace Sep 18 '18 at 13:53
• The calculator that I provided provides the same results that you provided in your question. – Bob Baerker Sep 18 '18 at 13:55