Can Market Makers See My Stop Loss Orders I Set for a Stock or ETF?

Market makers generally cannot directly see your stop loss orders, especially if they are set as stop orders or stop-limit orders that are not yet triggered. These orders remain hidden until the market reaches the specified price at which point they convert into market orders (or limit orders, depending on the type).

However, market makers can sometimes infer the likely presence of stop losses based on the price action, order flow, and liquidity levels at certain price points. This can happen especially in thinly traded stocks or during times of low liquidity.

Additionally, if you place a stop order with a broker, the order may be visible within that broker's system, and some brokers might route this information to market makers, depending on their order handling practices. It's always important to understand the policies of your broker regarding order visibility.

For example, Interactive Brokers (IB) does not explicitly route stop loss orders to market makers until the stop price is triggered. When you place a stop loss order with IB, the order is held on their internal system and is not sent to the exchange or market maker until the market reaches the stop price. Once the stop price is hit, the order converts into a market or limit order, depending on the type of stop order, and is then sent to the market for execution.

This practice is common among many brokers to prevent the stop loss order from being visible in the order book before it is triggered. Therefore, market makers and other market participants cannot see your stop loss order while it is still untriggered and held on IB's system.

The practice of sharing stop loss information with market makers varies among brokers, and it often depends on their order routing practices and the type of stop order you place. Generally, reputable brokers do not share untriggered stop loss orders with market makers, as this could potentially put their clients at a disadvantage.

However, some brokers, especially those that operate as market makers themselves or have less transparent order routing practices, might expose stop loss orders under certain conditions. Brokers that offer "payment for order flow" services might also be more inclined to route certain types of orders, including stop loss orders, to market makers, who then may have visibility of these orders once they are routed.

It's difficult to provide a definitive list of brokers that do share stop loss information with market makers, as these practices can vary and are not always publicly disclosed.

The best approach is to:

1. Research your broker's order handling practices: Check the broker’s order execution disclosures, which are often found in their terms of service or customer agreements.

2. Ask your broker directly: Contact your broker’s customer service or trading desk and ask them specifically about how they handle stop loss orders and whether they are exposed to market makers before they are triggered.

3. Use a broker with a transparent execution policy: Some brokers are more transparent about their order routing and execution practices, and may even offer features like "hidden" stop orders, where the stop price is not visible to market participants until it is triggered.

For specific brokers, the information might require direct confirmation with their support or legal disclosures.