Trading Floor Hand Signals

Jackie deangelis anthony grisanti pete najarian and jon najarian break it down.

Trading floor hand signals.

Trading floor hand signals decoded it s the end of an era at the cme. In an open outcry auction bids and offers must be made out in the open market giving all participants a chance to compete for the order with the best price. The part of the trading floor where this takes place is called a pit. It also provides anonymity to big traders and also traders believed that this methodology is less prone to manipulation.

It involves shouting and the use of hand signals to transfer information primarily about buy and sell orders. New bids or offers would be. Hand signals the sign language of futures trading represent a unique system of communication that effectively conveys the basic information needed to conduct business on the trading floor. Open outcry is a method of communication between professionals on a stock exchange or futures exchange typically on a trading floor.

The signals let traders and other floor employees know how much is being bid and asked how many contracts are at stake what the expiration months are the types of orders and the status of the orders. Hand signaling also known as arb 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. Hand signals are first adopted by chicago mercantile exchange in the early 1970 s. Cme hand signals are the default example with any variations listed in each exchange category.

Hand signals are better and faster than a verbal communication in a noisy trading floor environment. Enter the hand signal. Explore the open outcry hand signals below. This is the sign language used by professional traders on trading floors throughout the world.

The history of hand signals on the trading floor begins around the middle of the 19th century. The system is used at financial exchanges such as the chicago mercantile exchange cme and the american stock exchange amex.