I’ve always been passionate about stocks, commodities, currencies, and trading the financial markets as a whole. One of my aspirations is to become a floor trader.
What’s a floor trader you ask? Well, have a look at this video first:
[youtube:http://www.youtube.com/watch?v=XZEBz01t5vg]
(Soybean trading at the Chicago Board of Trade)
These folks trade on the floor of the exchange for their own accounts (contrast with trading through the internet or the phone). Trading on the floor of the exchange = FLOOR TRADERS.
If you look at the video above, trades are carried out based on the outcry system (i.e. traders shouting at each other) as opposed to the electronic system.
I don’t actually intend to become a floor trader indefinitely. I’d just like to experience the outcry system for once, and also, to be able to own a seat on the exchange. Then perhaps, lease the seat out to somebody else.
Anyway, as I’ve hinted above, to be able to trade personally on the exchange, you need to own a seat on the exchange or at least lease a seat from somebody else.
How much do these seats cost? Here are some indicators:
1. At the New York Stock Exchange (NYSE), a seat was sold for USD4 million in 2005.
2. At the Chicago Mercantile Exchange (CME), a seat can be bought for approximately USD1.5 million.
Yup, they are indeed expensive.
Below is a scene from the movie Trading Places, where the outcry system is shown. Watching the scene for the first time made my palms sweat like crazy. Haha 😀
[youtube:http://www.youtube.com/watch?v=RAXdie_gifI]
Here are a few more interesting videos:
1. A movie entitled FLOORED to be released in 2009
[youtube:http://www.youtube.com/watch?v=_UXomMnQKT4]
2. Cotton Trading
[youtube:http://www.youtube.com/watch?v=TksNZ8PxNu8]
3. NYMEX Open Outcry Trading Challenge for Students
[youtube:http://www.youtube.com/watch?v=qNd9AGYtCdI]
4. Robert Downey Jr. commenting on NYMEX Floor Trading
[youtube:http://www.youtube.com/watch?v=Dtc58sTsTpE]
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Disclaimer: This article is not a specific nor general advice on managing or investing your money. This article does not constitute a recommendation nor does it take into account your investment objectives, financial situation nor particular needs.
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Other related posts:
– CFD Trading : An Introduction
– CFD Trading/Share Trading : Setting Stop Loss
– CFD Trading/Share Trading : Stop Loss in Perspective
– CFD Trading/Share Trading : Being Long and Short (Concept of Short Selling)
– CFD Trading/Share Trading : Short Selling in Perspective
– CFD Trading/Share Trading : The 2% Rule
