Under the Longstaff-Schwartz LSM method for an American call, how should I account for a continuous dividend paying stock? I assume that it'll needs to be accounted for when simulating the underlying GBM stock paths but is there anywhere else where it differs from the LSM on a non-dividend paying stock?

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    $\begingroup$ Nope, that's all. Of course, discrete dividends are much easier to handle in MC than in trees, so you might want to go discrete anyway. Then again LSMC is so inaccurate you won't gain much from using discrete divs unless the dividends are huge. $\endgroup$ – Brian B Nov 8 '13 at 14:58

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