I got a response from StockCharts.com about the discrepancy on their QQQQ chart. Here’s what they said:

The data for QQQQ was adjusted downwards on December 17, 2004 to account for the dividend as described here: http://www.cboe.com/publish/TTStockSM/04-685.pdf

For more information on data adjustments, please see the following article: http://stockcharts.com/commentary/mailbag/mailbag20000804.html

Thank You,

StockCharts Support
http://stockcharts.com

Here are some points from the second link above (emphasis is mine):

The charts on StockCharts.com are adjusted downwards to account for dividends and fund distributions. Other sites may or may not make similar adjustments. By adjusting our historic data downwards whenever a dividend or distribution occurs, we feel we are giving you a truer picture of how the security actually performed over time.

An very similar situation occurs when a stock splits. You buy a stock in July at $50 and it rises to $100 by December and splits. If the chart showed a huge drop in price you would know something was wrong. What happens is the chart data gets adjusted for the split, and now it looks like you bought twice as many shares in July for $25 each and they are now worth $50.

The same has to happen with mutual fund distributions, dividends and other payouts. Let’s say you buy a fund at $10 a share, and it rises to $11, then pays a distribution of $1. If the chart shows a sharp 10% drop at year end and lists the NAV at $10, you are looking at raw data. You either received a check for $1 or you now have more shares than you did before. But the chart should adjust the share prices back in time to reflect the fact that the fund rose 10%. An adjusted data chart would show the correct price after the distribution of $10, and the earlier price would be an equivalent $9, with no sharp drop in the chart.

Adjusted data charts reflect the equivalent value of the stock or fund with respect to the present pricing. Just as you could not have bought the stock at $25 in July, your fund chart should show what the equivalent value of the fund share was in the past, to account for distributions.

Charts that do not reflect distributions should not be used to perform any technical analysis. The reason is simple — if you had bought VFIIX six months ago, you would have paid about $9.70 a share. If you sold it all today at $9.90, you would still need to add in the $0.30 dividend or distribution received during that period to calculate your gain. StockCharts.com’s adjusted data charts do that for you, and show the equivalent NAV of $9.40 six months ago.

Adjusted data for stocks is a different beast. When Ford spun off Visteon, holders of Ford stock received shares in Visteon — and the value of each Visteon share was equal to the drop in Ford share price on the day of the spinoff. If you invested in Ford, you still would have the same amount of capital. If you were going to buy shares that day – you would pay the listed price. The chart should reflect that new lower price for stocks, but it should not for mutual funds.

I really don’t like the fact that I’m seeing different data in different places for the same equity. I really don’t care which method is correct, I just want them to all be consistent. Maybe I’ll contact those other data providers to get their point of view.