Reserve (Iceberg) Order

Definition

Reserve (Iceberg) Order in plain English

Say you want to sell 10,000 shares but you know that if everyone sees a huge sell order, they'll panic and the price will drop before you finish. A reserve or "iceberg" order lets you show only a tiny slice — say 100 shares — while the other 9,900 sit hidden, like the bulk of an iceberg underwater. Each time your visible 100 gets bought, the system quietly refills it with another 100 from the hidden pile, so buyers only ever see a small amount and don't realize how big you really are. It's a way to trade a large position without spooking the market.

Learn these first

• Spoofing
• Time Precedence

Related Market Microstructure terms

• Access Rule (Rule 610)
• Call Auction
• Continuous Auction
• Iceberg Order
• Limit Order
• Limit Order Book (LOB)
• Maker-Taker Fee Model
• Order Protection Rule (Rule 611)
• Order-Driven Market
• Price Priority