Hidden Order
Market Microstructure glossary · High Frequency Dynamics & Latency Arbitrage
Definition
A limit order that is non-displayed in the order book but available for execution at its price. A common form of dark liquidity inside lit venues.
Hidden Order in plain English
A regular order to buy or sell at a set price usually shows up publicly in the 'order book,' the list everyone can see. A hidden order is the same kind of standing offer, but it's invisible on that list — it still executes if someone's trade reaches its price, you just can't see it sitting there waiting. Traders use it so they don't tip off others that a big buyer or seller is lurking, which could scare the price away from them. It's like a silent bid at an auction: your offer is genuinely in play, but nobody in the room knows it exists until it wins.
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