The Not-So Invisible Hands of the Market

photo source: nytimes

Would you want the life of millions of dollars hanging in the balance of your finger dexterity? These folks do. Financial professionals in a stock or futures exchange gather at a part of the trading floor called a pit. They use Open Outcry, a combination of shouting and hand gestures, to relay information about buying and selling orders. This hand gesture system, Hand Signaling also known as Arb (short for arbitrage) was developed from the need to quickly exchange information across far distances and loud surroundings. Seconds, even microseconds, can make a huge difference during an open outcry, so hand signalling proved to be a great asset.

There are symbols for numbers, names of banks, months, and types of transaction. The signals sometimes seem strange but employ a fairly sensible logic, for example Goldman Sachs is represented by someone pretending to touch his or her thumb to an imaginary “gold ring” on his or her ring finger. Let’s take a look at two of the most important ones: buying and selling:

Buy

buy

Looks like the signaler is pulling and wants to “get” something. Also looks like he or she is copping a feel on themselves.

Sell

sell

Looks like the signaler is trying to push or get rid of something as well as trying to cop a feel on someone else.

Dying Art

As you may have guessed, this form of communication is dying. The world is moving towards all-electronic everything and stock exchanges are no exception. Electronic trading systems offer advantages such as speed, efficiency, and accuracy, but Ryan Carlson, founder of tradingpithistory.com, is on a mission to preserve the hand signal language in all of its glory. As cities are beginning to phase this language out, Ryan is documenting all the different dialects to preserve a piece of hand gesture history.

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