Order Type Question

Some brokers(eg Interactive Brokers) allow an order to be completely hidden from the market. Zerodha also allows you to disclose a limited quantity (min 10%) of your order quantity when submitting an order.

Can someone(@Sensibull) kindly share your knowledge about the following questions I have ?

How do hidden orders work ? Are these exchange specific or is it broker specific ?
How are hidden orders submitted to the exchange. Since they do get executed, who can acutally see them and react on it?
What is the thought process to constrain order submission to min 10% of the order quantity in Zerodha ? Why does Zerodha not offer completely hidden orders ?
What kind of technology/connection is needed to see hidden orders across brokers or on an exchange ?

1 Like

Hello @abbanerjee - I do not know this question’s answer. @nithin @siva etc are way more knowledgeable on this topic. Sorry!

Nithin/ Siva?

@abbanerjee Completely hidden orders not permitted . you have to disclose minimum 10 % and it is exchange specific.once 10% get executed another 10% will come up .

I assume you mean orders placed via disclosed quantity option. It is up to user to use that option, that can be used by users when they are buying or selling in huge quantity( subjective to each scrip) so that their big order should not have material impact and result in distorted prices( offers and bids).
Can check this for more. It is exchange( regulator) defined.

Yeah thats the case for Zerodha but not true across brokers is what I understand.

i guess all brokers do provide this facility in cash market and it is same as minimum 10% disclose for all scrip on the choice of client.

There is nothing called hidden orders. Exchanges support a feature calleddisclosed quantity when trading equity. Essentially an option where you can decide to disclose only a fraction of the actual order size (minimum 10% has to be shown). This is from the exchange, and I am guessing almost every platform has this disclosed quantity feature for equity orders.

These orders are actually placed on the exchange, the entire quantity doesn’t show up in the market depth. This is to help people trying to execute large equity orders.

Like I said, this is not a Zerodha specific feature, this is from the exchange.

The only other way to hide an order is to not place them at all. Institutions have execution algo’s which instead of placing an order on the exchange keeps it on the system. This algo continuously reads the market depth, and places orders based on conditions set. We had tried this out earlier as a product, it was called i3, but we had to kill this because it wasn’t really possible to support retail clients due to compliance issues (as it was an algo). The only approval we got for was bracket and trailing stoploss orders.