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Do Not Reduce

   Also found in: Acronyms 0.01 sec.
Do Not Reduce Order
In a limit order following the ex-dividend date, an instruction not to reduce the limit price by the amount of the dividend. Most of the time, following the ex-dividend date, the price of the limit order is reduced because the coming dividend will belong to the current owner, rather than the buyer. One issues a do not reduce order if one believes that demand for the stock justifies the higher price.
do not reduce
An addition to a limit order to buy or a stop order to sell stock that states that the price will not automatically be reduced when the stock goes ex-dividend. Without this instruction, the price is reduced by the amount of the dividend to be paid.
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