Photo: Alex Howe for Business Insider
For the most part face-to-face trading is dead because it has been replaced with electronic systems.However, the open-outcry system, which is a form of communication where traders use hand signals to exchange information mostly about buy and sell orders, still exists at exchanges such as the CME, CBOE and CBOT.
It makes sense.
For example, “The Pit,” which is a raised platform in the CME where this open-outcry trading takes place — can get really loud.
When you’re trading in the pit, you use the hand signals to communicate to people outside to fill orders. Those orders are then handed off to a runner who drops the buy or sell order off at a post outside of the pit.
Some of the signals are pretty much standard, while some are proprietary.
We’ve put together these nine different hand signals traders use [via northmanfamily].