Glossary entry
Iceberg Order
Trading & MarketsA large order that reveals only a slice at a time, so visible book depth understates real interest. How it works and why traders use it.
Definition
An iceberg order is a large order of which only a small slice is displayed on the public order book at any moment; as each visible slice fills, the next is revealed automatically until the full size is done. Traders use it to reduce the market impact of showing size, because a visibly large order invites others to trade ahead of it or to pull their own quotes. The hidden remainder still exists and still executes, so the depth you can see on a book understates the real interest sitting behind it — one reason visible liquidity and actual liquidity are not the same thing.
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