As in so many other industries, robots have been marching into Wall Street for years. Instead of a boisterous trading floor, these days many US equity transactions happen in a data center in suburban New Jersey. One place where human traders are safe, though, is the New York Stock Exchange, which has roots going back two centuries.
The stock exchange has made sure its human presence is protected, for now. The stock exchange packs a marketing punch few, if any, businesses can match. One reason to keep humans around is, indeed, showmanship: When Snap CEO Evan Spiegel rang the opening bell for the first time earlier this year, its polished metal reflected blue-jacketed market makers and cameras on the trading floor.
Watson says the company virtually never follows up with anyone on the floor, and the value of such roles is up for debate. He said executives are mainly concerned with tapping the biggest pool of investors possible and making sure regulators are satisfied. If you wanted to identify a company that represents a future where humans and machines work together, there are few better examples than Myomo, a medical robotics maker. The DMMs are given money rebates in exchange for providing regular stock price quotes, liquidity, and maintaining orderly trading.
There's also a good amount of former athletes and army vets on the floor, our source said. Those are more important things than your GPA and college," the source said.
The work environment on the floor is "very fast-paced. These days there's more IM chatting than talking on the phone and more computers down here trading that human yelling and screaming, our source explained. People always have each others back even though they may have fought that morning. It's kind of like a brother-sister relationship. Our source added that they do a lot of charity work and "will always help out a fellow floor broker's sick kid or parents.
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This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. Some people believe there's a lot to lose by eliminating the open outcry method. That's because they say that electronic trading can only capture so much, while human activity on the floor reveals much more.
Proponents of the trading pit say having people on the floor can help relay the message of the pit, and can help provide an assessment of a trader's intentions behind a buy or sell move. Furthermore, companies that list on the exchange occasionally list the showmanship, human touch, and assurance of human traders during crises as reasons for their selection, according to Quartz.
Trading face-to-face also helps simplify orders that are more complicated such as commodity futures or options trades. The open outcry system has been part of the trading world since the s, establishing decorum and a language that many traders had to learn in order to do their job. Electronic trading may now be the norm of the industry, but it hasn't completely wiped out the open outcry system. Traders are still trading on the floor of exchanges for now. Michael Gorham and Nidhi Singh.
Elsevier, University of Amsterdam. Accessed June 8, Capital Amsterdam Foundation. CME Group. New York Stock Exchange. Accessed June 12, London Stock Exchange Group. Career Advice. Trading Basic Education. Stock Markets.
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