Wallstreet | On the floor?

Question

I wonder what the brokers on the floor at Wallstreet do? You know the ones that stand on the floor with different colored jackets shouting and screaming do?

1. What does the color of the jacket symbolize (company, field)?

2. How is any business done during all the mayhem?

Answer 1

I'm not sure but that's a very good question

Answer 2

the colour jackets symbolise what kind of stockmarket member they are. there are 3 types: Brokers(trades for clients), Dealers(trades for himself), Broker/Dealers(does both) as to what colours are used, and how many addiotional colours are used, differs per stock market.

the mayhem is actually the business being done. people shout their quotes to eachother. a dealer for example, would shout a certain stock price at which hes offering to buy. a dealer would shout a price at which hed like to buy. we call this 'open outcry' which is the old fashioned way of doing business.

theres also a newfashioned way, screentrade, as done on the tokyo stock exhange for example, this is where traders get their own terminal (pc) at which they enter their quotes. a certal server links, buyers to sellers.

open outcry has the advantage that theres a lot of atmosphere, and you can 'feel' whats happening to the market. a disadvantage is, you need a lot of space to trade. (lots of people, lotso f room)

screentrade has the advantage, that people can trade from anywhere aslong as they have a link to the system. this saves a lot of tradingspace. and thus money. the downside is that its very inpersonal, very static, and you cant really feel the market other than by looking atthe numbers.

you can cmopare it to a fishmarket really, the marketsales men stand there shouting TROUT TROUT $1,50 A KILO!!! if they dont sell enough, they start shouting trout $1,49 a kilo!

Answer 3

The color of the jacket is basically each member firm's choice, even though they can be identified by their badges.

So all employees of that firm, whether they are market makers, traders, or floor clerks they all have the same color.

Most floor traders will basically the same type of jacket

Exchange clerks also wear the same type of jacket.

All identification is done by their badges, and to be on the floor everyone must have their badge in full display.

The shouting (screaming) is a way of getting someone's attention and making their bid/ask known to the crowd.

All hand signs, gestures and terms have a special meaning to those on the floor.  (There is one univeral sign that's used on floors in the US & Europe and NY cab drivers).  Cursing is not allowed verbally on any floor.

The floors are really very well organized and only looks like it's mayhem.  For those on the floor everything is very logical the way things and people move.  

After awhile, you get used to the way the varios floor act, and react accordingly.  Usually for the first 15 minutes is a little rough until you realize on what floor you are on.