Trading Floor Hand Signals

Hand signals are first adopted by chicago mercantile exchange in the early 1970 s.

Trading floor hand signals.

Jackie deangelis anthony grisanti pete najarian and jon najarian break it down. Explore the open outcry hand signals below. Enter the hand signal. It also provides anonymity to big traders and also traders believed that this methodology is less prone to manipulation.

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. New bids or offers would be. The system is used at financial exchanges such as the chicago mercantile exchange cme and the american stock exchange amex. Open outcry is a method of communication between professionals on a stock exchange or futures exchange typically on a trading floor.

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. The part of the trading floor where this takes place is called a pit. Cme hand signals are the default example with any variations listed in each exchange category. Trading floor hand signals decoded it s the end of an era at the cme.

Brokers and traders found themselves unable to reconcile the distance between their personal staffs working feverishly in offices high above the pit and the pit itself. 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. This is the sign language used by professional traders on trading floors throughout the world. 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.

Hand signals are better and faster than a verbal communication in a noisy trading floor environment. The history of hand signals on the trading floor begins around the middle of the 19th century.