I have been hesitant to post some of my A-Eye research, fearing it may be too long and "blow up" the readability of all the great contributions here, but here goes anyway. I used to "enjoy" shorting tickers, esp when big profits are made quickly, but with historic trend upwards, shorting is like betting against the house....you might win sometimes, but you are swimming upstream. That said, I will pursue some semi-or-fully automated day trading on indices. Be aware that if you are short a ticker, you will be assessed dividends....so here are some work arounds.

Short answer: you normally can’t short a dividend-paying share and avoid paying the dividend — if you borrow the share to short it, your broker will require you to pay the lender an equivalent amount (a “payment in lieu” of the dividend).

If your goal is economic short exposure without having to directly pay dividends, here are the workable alternatives (with pros/cons and practical notes):

1) Buy put options (or put spreads) — the simplest retail alternative

What: buy a put on the stock (or buy a bear-put spread to reduce cost). If the stock falls, the put gains; you never borrow shares so you don’t pay the dividend.

Pros: limited downside (max loss = premium paid), no dividend payments, easy to trade in most brokerage accounts.

Cons: options expire (time decay), can be expensive if implied volatility is high, and a sustained slow decline can still lose money because of theta. Early-exercise/assignment risk exists for short option sellers (not buyers) around ex-dividend dates, so be careful if you sell options.

2) Use inverse ETFs (if you want index/sector short exposure)

What: buy an inverse ETF that moves opposite an index (or -1x/-2x/-3x leveraged inverse ETFs).

Pros: no share borrow, no dividend payments from you as a short. Works well for short-term tactical exposure to an index.

Cons: many inverse ETFs rebalance daily and suffer compounding/decay over time — they’re typically not suitable as long-term shorts. Also, for single-stock exposure you likely won’t find a single-stock inverse ETF.

3) Use single-stock futures / CFD / swaps (institutional / non-US retail options)

What: institutional investors can use total-return swaps or cash-settled derivatives to get short exposure without borrowing shares; offshore brokers offer CFDs that simulate short exposure without lending.

Pros: can replicate short returns without paying dividends directly.

Cons: TRS/OTC swaps are mostly for institutions; CFDs are not allowed in the U.S. for retail and carry counterparty risk and fees. These are complex and require careful legal/credit consideration.

4) Short the stock but close before the ex-dividend date

What: if you must short the share, close the position before ex-dividend to avoid becoming responsible for the dividend payment.

Pros: avoids dividend cashflows.

Cons: requires precise timing — ex-dividend risk and price behavior around ex-dividend can make this costly. Also borrowing costs and recall risk still apply.
Schwab Brokerage

Tax and accounting note

Payments you make to the lender (“payments in lieu of dividends”) when shorting are treated differently for tax purposes; there are special rules (and possible limits on deductions) — check IRS Pub. 550 / expert tax advice for your situation.
TaxAct

Practical retail recommendation (if you’re not an institutional trader)

If it’s a single stock: buying puts (or a bear-put spread) is usually the cleanest way to be short economically without paying dividends.

If it’s a broad market or sector: consider an inverse ETF for short-term trades.

Avoid naive short-selling of dividend payers if your goal is to avoid paying dividends — the broker will pass that cost through to you.

Always check: option liquidity, bid/ask spreads, margin requirements, borrow fees (if shorting), and your broker’s rules about payments-in-lieu and forced buy-ins.

Risks & final cautions

All these alternatives have tradeoffs (time decay, counterparty risk, daily rebalancing, assignment risk, etc.). Don’t treat options or inverse ETFs as “free” or riskless substitutes for shorting. Talk to your broker about execution costs and to a tax pro about tax treatment for payments in lieu.

If you want, tell me the ticker and whether you prefer a conservative/cost-sensitive approach or an aggressive one, and I’ll sketch concrete option strikes/ETFs or walk through an example trade (with estimated costs and risks).