Stock price adjustment ex dividend
The nominal share price then goes down by the dividend per share, on the ex-dividend date. To create a consistent time series of adjusted stock prices, we calculate an “adjustment factor” that encapsulates the drop in the share price, and then divide all pre-dividend prices by that adjustment factor. Dividend Adjustment Calculation Details: Historical prices are adjusted by a factor that is calculated when the stock begins trading ex-dividend. The amount of the dividend is subtracted from the prior day’s price, and the result is divided by the prior day’s price. Historical prices are then multiplied by this factor.