Suppose a stock pays a fixed percentage dividend stream q that is continuously reinvested, such that an

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Suppose a stock pays a fixed percentage dividend stream q that is continuously reinvested, such that an initial investment S0 has time T value eqTST. Construct an arbitrage portfolio for a forward contract and find the delivery price, such that entering the contract does not cost anything.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...
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