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Intermarket sweep orders (ISO) sweep several different market centers and scoop up as many shares as possible from them all. These work against the order-protection rule. For example, if a trader is trying to buy 100 shares of X, and there are 10 shares of X being offered at $1 at one exchange and 1000 at $1.10 at another exchange, the order protection rule would let you buy ONLY those 10 shares at $1, after which you would need to send in other orders. With the ISO, you can buy the 10 shares at $1 and the remaining 90 at $1.10 on the other exchange subsequently.

References [link]

BATS Exchange Order Types and Definitions

FINRA ISO Reporting Rules

SEC NMS Rule FAQ

WSJ: Accenture 'flash crash' and Intermarket Sweep Orders

Minyanville: How ISO's May Be Used as Predatory Trading Tactics

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