Orders & ExecutionReserve OrderHidden Size Order
Iceberg Order
A large order that displays only a small portion of its total size, replenishing it as each slice is filled.
What Iceberg Order means
An iceberg order splits a large quantity into a visible tip and a hidden body. Only the display quantity appears in the order book; when it is filled, the system automatically posts another slice of the same size at the same price until the full amount is done or the order is cancelled. The purpose is to work size at a chosen level without revealing the true intention, since a visibly large resting order invites other participants to trade ahead of it or to pull away from the price.
The mechanic carries a cost. On most venues each refreshed slice loses queue priority and goes to the back of the line at that price level, so an iceberg typically fills more slowly than an equivalent fully displayed order. Some venues also charge differently for hidden liquidity. Sophisticated participants routinely attempt to detect icebergs by watching for a price level that absorbs repeated fills without disappearing.
Iceberg orders belong to order-driven, centrally cleared markets and to institutional forex venues with a genuine central book. In retail forex they are uncommon, because most retail platforms quote against a broker or an aggregated feed rather than exposing client orders to a shared book. Where a retail platform offers the feature, it is usually implemented locally by the order server rather than by any exchange.
Worked example
A fund working 50 standard lots of EUR/USD at 1.0820 sets a display size of 5 lots, so the book shows only 5 at a time and posts a fresh 5 lot slice after each fill until all 50 are executed.
Related terms
- Order BookThe list of resting buy and sell limit orders at each price level on a trading venue.
- Depth of Market (DOM)A display of the quantity of bids and offers resting at each price level around the current market.
- Partial FillExecution of only part of an order's requested quantity, with the balance either resting or cancelled.
- LiquidityThe ease with which an instrument can be traded in size without materially moving its price.
- Limit OrderAn order to buy at or below a stated price, or sell at or above it, guaranteeing price but not execution.
Frequently asked questions
What does Iceberg Order mean in forex trading?
A large order that displays only a small portion of its total size, replenishing it as each slice is filled.
How does Iceberg Order work in practice?
The mechanic carries a cost. On most venues each refreshed slice loses queue priority and goes to the back of the line at that price level, so an iceberg typically fills more slowly than an equivalent fully displayed order. Some venues also charge differently for hidden liquidity. Sophisticated participants routinely attempt to detect icebergs by watching for a price level that absorbs repeated fills without disappearing.
What is an example of Iceberg Order?
A fund working 50 standard lots of EUR/USD at 1.0820 sets a display size of 5 lots, so the book shows only 5 at a time and posts a fresh 5 lot slice after each fill until all 50 are executed.
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