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Fact 1: if you are not good at pricing options, of course you can create a lot of arbitrage opportunities for the rest of the market. It does not matter whether the reason is in dividends or anything else. Fact 2: if you are good in pricing options, you price the dividend effect in advance. Consider the situation of the European calls, and suppose that both ...


Generally no, because 'dividends' are already 'priced into' the options. Which means, if an ATM call cost 0.50, and stock price drops by 1.00(amount of dividend), the ATM becomes OTM, but it may still cost 0.50, because the initial price of 0.50 already factored in the dividend.

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