The Merc — historical trivia

[from Wikipedia]

The Chicago Mercantile Exchange (CME) (often called “the Chicago Merc,” or “the Merc”) is an American financial and commodity derivative exchange based in Chicago and located at 20 S. Wacker Drive. The CME was founded in 1898 as the Chicago Butter and Egg Board, an agricultural commodities exchange.

Trading platforms

Trading is conducted in two methods; an open outcry format and the CME Globex electronic trading platform. Approximately 80 percent of total volume at the exchange occurs electronically on CME Globex.

Open Outcry

Operating during regular trading hours (RTH), the open outcry method consists of floor traders standing in a trading pit to call out orders, prices, and quantities of a particular commodity. Different colored jackets are worn by the traders to indicate their function on the floor (traders, runners, CME employees, etc.). In addition, complex hand signals (called Arb) are used. These hand signals were first used in the 1970s. The pits are areas of the floor that are lowered to facilitate communication, sort of like a miniature amphitheater. The pits can be raised and lowered depending on trading volume. To an onlooker, the open outcry system can look chaotic and confusing, but in reality the system is a tried and true method of accurate and efficient trading.

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