Should the forward contract (or futures contract) value be higher or lower when the underlying generates cash

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Should the forward contract (or futures contract) value be higher or lower when the underlying generates cash flows and by how much? Explain with an example of a stock that pays dividends.

Posted Date: May 18, 2024 10:09 AM

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Should the forward contract (or futures contract) value be higher or lower when the underlying generates cash

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