TradeStops will adjust prices for stock dividends. We do this for splits too.

LONGS:

Entry Price Adj= Entry Price * StockDividendAdjustmentFactor

Shares=Shares * (1/ Stock Dividend Adjustment Factor)

StockDividendAdjustmentFactor=1/(1+number of new shares issued per share owned)

Example:

Position A: Entry date=01/01/2014, Entry Price=$100, Shares=10, stock dividend was issued for additional 0.1 shares per 1 share owned.

Calculations:

StockDividendAdjustmentFactor=1/(1+0.1)=0.9091

Entry Price Adj=$100*0.909=$90.91

Shares=10*1/0.9091=10.999

SHORTS:

Entry Price Adj= Entry Price * StockDividendAdjustmentFactor

Shares=Shares*1/StockDividendAdjustmentFactor

StockDividendAdjustmentFactor=1/(1+number of new shares issued per share owned)

Example:

Shares A: Entry date=01/01/2014, Entry Price=$100, Shares=10, Per each share owned were issued additional 0.1 shares

Calculations:

StockDividendAdjustmentFactor=1/(1+0.1)=0.9091

Entry Price Adj=$100*0.909=$90.91

Shares=10*1/0.9091=10.999

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