Interesting insight into the current form of Trading now in play...

Interesting insight into the current form of Trading now in play on BLR

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An iceberg order is a large order that is broken up into small orders to disguise the interest of a single large buyer or seller. This is done because the market is likely to react to the existence of a single large buyer or seller (which may be significant) than it is not a burst of orders from small buyers (which is likely happen by chance occasionally).

Some markets directly support iceberg orders. It is entered as a single order, but only a portion of it is publicly displayed at any time. The hidden part of the order is not usually available to match other orders until the portion that is publicly available has executed. The effect is the same as if it was a series of small orders, each of which is entered as soon as the previous one executes. If the exchange does not support iceberg orders, the order can be entered as a series of small orders.

Iceberg orders are usually both more automated and more complex. Automated systems will slice an order up into smaller orders of varying size, decide on the timing of orders, and may send orders to different markets and trading venues: for example choosing whether to send the order to a stock exchange or a dark pool. This is called algorithmic trading.


Traders, especially high frequency traders, will look for indications that a series of orders is in fact a single order that has been divided in an attempt to conceal the fact that it is a single order. If they are successful this can partially undo the benefits of the iceberg order, as they are then able to trade ahead of it.

What are Iceberg Orders? ​

An Iceberg order allows you to submit an order (generally a large volume order) while publicly disclosing only a portion of the submitted order. ITS prioritises the shown quantity of all orders in the order book over all hidden quantities of any order at this same price. What is the Function of an Iceberg Order? Functions within ITS are as follows: • Iceberg orders are able to be entered during all session states supporting order entry.

• Iceberg orders are available for Equity, Interest Rate and Warrant instruments.

• Iceberg orders entered by another Participant are not flaggedin ITS as iceberg orders. There is no indication in ITS to identify an iceberg order in the central order book that has been entered by another Participant. Only your own iceberg orders will be visible in the order book.

•The minimum limit for the visible component of the order is quantitybased, with the minimum shown quantity set at 5,000 sharesfor Equity, Interest Rate and Warrant instruments.

• There is no limit set on the total order quantity.

• When the entire shown quantity of an iceberg order is traded, the order is immediately replenished in the order book as the last order at its price.

• The replenished order will display the preset shown quantity unless the total order quantity remaining is less than this amount, in which case the total remaining order quantity is made visible.

• Total order quantity (shown and hidden order quantities) will be included in any calculations of Equilibrium Prices (Indicative Auction Prices) and Surplus Volume.

• When an iceberg order is entered either as a new order which partially trades out immediately or when an amendment to a price occurs, thereby effecting the time priority of the order, the shown quantity will always be replenished in the order book. Note  Client Order Priority – When you enter an iceberg order on behalf of a client, you need to inform the client that the full quantity of this iceberg order will not retain priority in the market place. Placing an Iceberg Order Iceberg orders are entered using either of the two Enter Orderwindows. To do this you:

• Enter the “shown” quantity for the order in the Qtyfield. This must be greater than the minimum quantity required for an iceberg order.

https://www.asxonline.com/intradoc-cgi/groups/trading_and_market_information/documents/communications/asx_017441.pdf



Cheers from G64