i know whenever we create synthetic futures. the amount of futures to buy will be V (1 + r)^T how does dividend yld fall into all of this? if i am going to long or short using futures on an equity market and the dividend yld is 2%, what does that affecT?
Dividend yield is used only if you want to know how many stock at start you have effectively purchased. N(stock) = (N(future)*multiplier)/)(1+dividend yield)^n
typo N(stock) = (N(future)*multiplier)/(1+dividend yield)^n