On this page is a NASDAQ Composite Index total return calculator. It lets you estimate the return contribution of reinvested dividends to a theoretical NASDAQ investment, and further adjust those returns for inflation to calculate an estimated total return.
Through 8/15/2024 close. For last year, see the 2023 NASDAQ Return.
NASDAQ Total Return Calculator (with inflation adjustment)
To estimate a NASDAQ investment return, fill out a starting and ending date, and choose whether to adjust for inflation.
- Starting Month / Starting Year - The starting month of an investment in the NASDAQ Composite Index.
- Ending Month / Ending Year - The ending month (or the month sold) of an investment in the NASDAQ Composite index.
- Adjust for Inflation (CPI)? - Whether to adjust returns for inflation (checked) or calculate nominal returns. Adjust for inflation to compare returns to other already adjusted returns – remember, investments are in nominal dollars, so adjusted results are what you would see in a theoretical investment.
Depending on your choices above, you can quote estimated returns from a NASDAQ investment with a few assumptions.
- Total NASDAQ Price Return - The total price return of the NASDAQ composite index. This is the naive return figure, which only uses the average closing price in the starting and ending month.
- Annualized NASDAQ Return - The total price return of the NASDAQ Composite Index, annualized. This is the return by year using the naive return computed in the above field.
- Total NASDAQ Return (Dividends Reinvested) - A better estimate of the total return on the NASDAQ Composite index over the holding period, using estimated dividends and calculating the effect of reinvesting.
- Annualized DJIA Return (Dividends Reinvested) - The annualized (return per year) estimate of the total return on an investment in the NASDAQ composite
- Inflation Adjusted (CPI)? - An informational box that will tell you if the most recent scenario was adjusted for inflation in the form of CPI-U (the US Consumer Price Index for all Urban Consumers).
All months (except the last month in the tool, as listed) use daily average closing price. That is, monthly prices are a blended average, and you can't point to an individual day of an investment.
Methodology for the NASDAQ Return Calculator
For official NASDAQ data, visit Nasdaq, Inc.'s Indices page. Here is what you need to consider with the tool's methodology:
- 'Month' is an average. The numbers behind the results do not correspond to particular dates but to monthly average closing prices on the NASDAQ. Dividends are based on trailing twelve-month dividend estimates.
The results are closer to how an 'average investor' would have performed buying on a random date and time in the starting month and selling on a random date and time in the ending month. There is no 'exact date' data in the tool (other than in the most recent month). - Fees are not included. Mutual funds and ETFs now track the NASDAQ Composite, but they are a relatively recent phenomenon. Whether purchasing stocks individually or investing through a fund, a real investor would have almost certainly paid fees to track the index. An individual investor trying to track the NASDAQ might incur fees for buying, selling, reinvesting, maintaining their account, etc.
- Data only goes back to 1973. The NASDAQ Composite began trading in 1971.
- Taxes are not included.
Sources for the NASDAQ Calculator
- Nasdaq, Inc.'s Indexes Page
- Consumer Price Index for All Urban Consumers (Downloaded from the St. Louis Fed)
- NYSE vs NASDAQ returns Market microstructure or the poor performance of initial public offerings? Tim Loughran (1993)
- Bubbles in the dividend–price ratio? Evidence from an asymmetric exponential smooth-transition model David G. McMillan (2007)
- Predicting the equity premium with dividend ratios: Reconciling the evidence Neil M. Kellard, John C. Nankervis, Fotios I. Papadimitriou (2010)
- EXPLOSIVE BEHAVIOR IN THE 1990s NASDAQ: WHEN DID EXUBERANCE ESCALATE ASSET VALUES? Peter C. B. Phillips, Yangru Wu and Jun Yu (2011)
- Signalling the Dotcom bubble: A multiple changes in persistence approach Vitor Leonea, Otavio Ribeiro de Medeiros (2015)
- Changes in the Composition of Publicly Traded Firms: Implications for the Dividend-Price Ratio and Return Predictability Stephan Jank (2015)
- Identifying asset pricing bubbles Testing for explosive behavior in the NASDAQ and STOXX 600 Europe Technology indices Smits Van Oyen, Tim and Elmer, Mathias (2016)
Disclaimers for the NASDAQ Return Calculator
This information is for research and educational purposes only. Dividends, inflation, and closing prices are derived from a sampling of many sources (listed above) and compiled into the calculator's data. DQYDJ can make no guarantees to its accuracy. You should verify any results with other sources.
All numbers are approximations of actual investor performance. They do not account for fees, taxes, timing, slippage, and hundreds of other effects on actual performance. NASDAQ tracking funds are a recent invention, and I don't consider the tracking errors of an individual investor buying and selling thousands of stocks.
None of the data in our calculator matches any exact dividend payout dates nor index closing prices on any individual date.
Dividend reinvestment adds up
As I talked about when I created the S&P 500 total return calculator, financial journalists (and social media commentators...) often produce unfair comparisons of investment returns on stocks and indices. Commonly, they neglect the effect of reinvesting dividends on ultimate investment returns. Other times, they'll compare nominal returns to inflation-adjusted numbers.
And, even on the NASDAQ, dividend reinvestment matters.
The NASDAQ Composite Index first started tracking stocks in 1971. Companies listed on NASDAQ were traditionally biased towards less profitable and higher-growth potential stocks. To a degree, that tradition has held – compared to the S&P 500 and Dow Jones Industrial Average, there are fewer dividend payers in the NASDAQ Composite.
But this tool may better illustrate the importance of dividends than my others. When reinvested, even a relatively small dividend payout makes a significant difference over time. Try more prolonged periods and see for yourself – it adds up.
Other posts
I built a tool to analyze rolling period returns at the NASDAQ Historical Return Calculator.
Try the ETF return calculator and mutual fund return calculator for individual investors. I've also built an S&P 500 Return Calculator and a Dow Jones Industrial Average Return Calculator.
Alternatively, see all the investment tools I've built here.
