wilslm

May be it's confusing but here is what is clear to me.

Let us say today IBM is trading at $100. You buy a forward contract on IBM for $110 which expires in 1 year.

After two months IBM declares a special dividend of $10 to be paid a day before year end (i.e., a day before contract expires). The price of IBM will then drop $10 on ex-dividend day. You will then pay $110 to own a stock that has just dropped $10.

You (the long) clearly lost (not gained as stated above) due to a rise in dividend. No?