What is "Dividend Accrual"

[DHOHHI]

Quote from Martin Gale:

Exactly. Thanks for a reasonable reply. I have no problem with risk. I have a problem factoring dividend into risk/reward. Haven't thought this through. You obviously take on more risk, which may not be worth it. This was the crux of my question, which the trolls here ignored. ET posers like el pollo love it when someone acknowledges a losing trade because it makes them feel like they have company in their general failure.

I sometimes reduce my position prior to the dividend coming into play. But that decision is impacted as to how much $$$ I'm up (or down) at that point in time. If I have a decent profit going I may stay short my entire position if I feel the stock will continue to act weak. Overall market sentiment also influences me some.

 

[Hurricane]

Quote from Bob111:

this bring us to another question-how do you report dividend accruals on your taxes?
you can't put negative number in dividends received

Cash basis tax payers don't have to report accrued dividends. It's only reported in the year actually received/paid. If received, it's dividend income reported on form 1040. If paid, as is the case if you held the stock short on the record date, it adds to your basis which reduces the amount of capital gains reported on Schedule D when the stock is purchased back.