Do Not Reduce Orders (DNR Orders)


The term Do Not Reduce refers to broker instructions to not lower the price of an order by the amount of an ordinary cash dividend on the ex-dividend date.  Do Not Reduce orders typically apply when the price on an order is under market, and accompanied by Good-Til-Canceled instructions.


If not specified, a broker will typically reduce the price on limit orders to buy or sell a stock, or stop limit orders to sell a stock, on the day the security trades ex-dividend.  This is done because when a stock goes ex-dividend, its value decreases by the amount of the dividend.  To ensure the order is only affected by market conditions, the broker reduces the order price by the amount of the dividend.

A Do Not Reduce (DNR) order instructs the broker to keep the original price on the order.  DNR orders apply to buy and sell limit orders as well as stop limit orders that are priced below market.  DNR applies to ordinary cash dividends; it does not apply to stock dividends.

Related Terms

market peg orders, National Best Offer, National Best Bid, market order, limit order, day orderprimary peg orderslong position, alligator spread, dark pools, discretionary ordersmidpoint peg orders, Not-Held orders, order book