StockTrader/hand signals

http://www.oxfordfutures.com/docs/Handsignals.pdf

Rated Jul 05 2006 • 1 review • investing, commodities, futures, hand signals • oxfordfutures.com

The Art of Hand Signals

Hand signals -- the sign language of futures trading -- represent a unique system of communication that effectively conveys the basic information needed to conduct businness on the trading floor. The signals let floor brokers and order clerks know the quantity, price and expiration month of an order, the specific type of order, and to check on the status of an order. The signals are the favored form of floor communication, especially in the futures pits, ...

Hand Signal Development

Hand signals began being used extensively at CME [Chicago Mercantile Exchange] in the early 1970s, after the Exchange created the International Monetary Marker (IMM) and became the first U.S. futures exchange to offer financial (rather than agricultural/mineral) futures. Although speed had long been a key element in futures trading, it became even more important when financial futures entered the trading scene. Why? Because traders discovered they could take advantage of arbitrage opportunities between CME and other markets if they could trade quickly enough. (Arbitrage refers to the simultaneous purchase and sale of the same or an equivalent commodity or security to profit from price discrepancies. When price discrepancies emerge in the marketplace, the abitrageur buys/sells until it is no longer profitable, or until prices are back in equilibrium.) Hand signals met the need to speed up communication in the fast-moving financial futures pits. ..."

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