5.1.2 Data adjustments

Many data sources, especially free ones usually do not come with data adjustment and may not give you the true idea of the price of the equity. Data in ChartNexus is adjusted for splits.

WITHOUT data adjustment, when stock splits, the chart will appear as shown in Figure 5.1:

\includegraphics[width=1\textwidth ,bb=0 0 604 416]{data_nonadjusted.png}
Figure 5.1: Non-adjusted data with a huge gap distorting the chart.

WITH data adjustment, either/both previous price and volume data values are adjusted to match the new valuation. This will allow the price and volume information to maintain a consistent scale with new data.

When there’s an adjustment event, a bell icon will appear in the chart as shown in Figure 5.2:

\includegraphics[width=1\textwidth ,bb=0 0 550 446]{data_adjusted.png}
Figure 5.2: Adjusted data closes the gap and indicated with a bell icon. Move your mouse over the bell to see the description of the event.