Order Types
A customer places a buy limit order at $35 on a stock trading at $37. The stock goes ex-dividend for $0.50. What happens to the order?
By default, buy limit and sell stop orders (BLiSS orders below the market) are reduced by the dividend amount on the ex-dividend date. The order adjusts from $35 to $34.50 ($35 - $0.50). The customer can add "DNR" (Do No
Complete Analysis & Legal Rationale
By default, buy limit and sell stop orders (BLiSS orders below the market) are reduced by the dividend amount on the ex-dividend date. The order adjusts from $35 to $34.50 ($35 - $0.50). The customer can add "DNR" (Do Not Reduce) to prevent this adjustment.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Does not match the governing securities rule described in the explanation.
Matches the verified teaching point in the explanation.
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.