How Does the ‘Peak Size’ Parameter of an Iceberg Order Influence Its Effectiveness?

The 'peak size' is the visible portion of the iceberg order. A smaller peak size maximizes concealment, reducing the chance of other traders detecting the full order size, thus minimizing market impact.

However, a very small peak size can take a long time to fill the entire block, increasing the opportunity cost and the risk of the market moving away from the order's price.