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Open outcry is a method of communication between professionals on a stock exchange or futures exchange, typically on a trading floor. It involves shouting and the use of hand signals to transfer information primarily about buy and sell orders. [2] The part of the trading floor where this takes place is called a pit.
Men working the floor at the Chicago Board of Trade as photographed by Stanley Kubrick for Look magazine in 1949 Trading floor at the Chicago Board of Trade in 1993. The concerns of U.S. merchants to ensure that there were buyers and sellers for commodities have resulted in forward contracts to sell and buy commodities.
The open outcry floor became a cacophony of shouting traders and pit cards. The pits became a place where many people without much education or ability to fit into Wall Street could have a chance at being rich. Goodman's book tells the stories of many of the personalities that built the exchange in this era. [6]
The row highlights a long-running battle between modernists and traditionalists over the future of the LME ring, the last open-outcry trading floor left in Europe after other exchanges for ...
The pits are areas of the floor that are lowered to facilitate communication, somewhat like a miniature amphitheater. The pits can be raised and lowered depending on trading volume. To an onlooker, the open outcry system can look chaotic and confusing, but in reality, the system is a tried and true method of accurate and efficient trading.
Trading was conducted by open outcry, where traders meet on the trading floor (in what is called the pit) to conduct trades. The Exchange was originally housed in the historic Royal Exchange building near Bank but then moved to Cannon Bridge in 1991. [3] [4]
The terms "dealing room" and "trading floor" are also used, the latter being inspired from that of an open outcry stock exchange. As open outcry is gradually replaced by electronic trading , the trading room becomes the only remaining place that is emblematic of the financial market.
Hand signalling on the floor of the Chinese Gold and Silver Exchange Society. Hand signaling, also known as arb [1] or arbing (short for arbitrage), is a system of hand signals used on financial trading floors to communicate buy and sell information in an open outcry trading environment.