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<FONT face=Arial color=#0000ff
size=2>"Correct" is in the eyes of the beholder. IMO, we should use
data that has been backadjusted for splits AND dividends. The
problem with backadjusting for dividends is that the resultant historical prices
can go negative and cause problems for some trading systems.
To ignore dividends can surely cause some serious (false) breakouts and outlier
profits/losses.
<FONT face=Arial color=#0000ff
size=2>
The
largest problem for futures traders is rollovers. IMO, dividends for
stock traders is of the same magnitude.
<BLOCKQUOTE
>
<FONT face="Times New Roman"
size=2>-----Original Message-----From: Steve Almond
[mailto:steve2@xxxxxxxxxxxxxxxxxxxx]Sent: Wednesday, October 22,
2003 4:56 AMTo: AmiSubject: [amibroker] Dividend
Question
I've seen discussion about dividends on this board from time
to time. Never took much notice, because dividends seemed so insignificant.
Today one of my systems threw up IOM, and I learned different.
On 10/2/2003 IOM paid a dividend of $5. <FONT
size=2>Attached are two charts which (I think) show the effect of accounting
for this dividend or ignoring it.
Obviously, differences of this magnitude have an extreme
effect on many TA systems.
Which chart is 'correct'?
SteveSend
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