Monday, April 30, 2012


Yesterday on a flight I was able to read Joyce, Queen of the Mountain and enjoyed the stories of a past era when she was mostly on the CBOT but also the CME.  Although the book is directed to primarily share a female's perspective of working in the trading pits, I have to admit to appreciating it more for the interactions and stories of the industry's legends which were sprinkled throughout.  Joyce is largely set in the 70s and 80s which was not only one hell of a volatile trading period but also known for hard living and wild partying so the book equally as interesting for stories outside the pits as it was regarding the trading floor.

My favorite quote of the book was from a Barry Lind citation in Time Magazine, "Commodity Trading makes you grow old fast but keeps you young forever."  Amen to that!  It brings to mind one of my favorite quotes from Fooled by Randomness, "no other lawful profession in our times could be as devoid of boredom as that of the trader. Furthermore, although he has not yet practiced the profession of high-sea piracy, he is now convinced that even the occupation of pirate would present more dull moments than that of the trader."

Specifically about hand signals, I was enlightened about how the CBOT 'filled' signal was developed from page 74 in Joyce:

"Back in the 1940s when an open out-cry trade was completed inside the pit, the transaction was considered a gentleman's agreement and the buyer and seller would shake hands upon completion.  As the pits became busier and more crowded, the trade procedure changed and upon completion you made physical contact by tapping the other trader's shoulder or body.  As the pits became more chaotic and crowded still, it became impossible for traders to walk through the wall of flesh and have this key physical contact to seal the deal.  Instead, a chopping hand signal was devised using the wrist motion of the handshake.  This replaced physically touching the other trader.  The chopping motion meant 'sold' and now you hear traders say the word 'Sold' accompanied by this chop of the hand.  Eventually, the hand chop movement alone became the signal from the broker to the trading desk that their order had been filled."

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