All eyes were on the New York Stock Exchange on Wednesday after it halted trading for 3.5 hours due to a technical glitch.
The storied NYSE in lower Manhattan is a symbol of American capitalism.
The floor isn’t what it used to be though. The population on the floor has decreased in recent years due to the rise of electronic trading.
Still, the floor brokers, specialists and designated market-makers (DMMs) on the trading floor are the face of Wall Street, constantly appearing in photographs, newspapers and on financial television. Despite their visibility, though, it’s not easy to tell what they’re actually doing down there.
One floor broker, who will remain anonymous, took the time to explain his role in the market and daily routine.
A floor broker provides information for their clients. They are the 'eyes and ears' for their clients' stocks.
A floor broker's clients can include banks, broker-dealers, hedge funds, mutual funds, pension funds, day traders and even some high net-worth individuals.
'We are the 'eyes and ears' to our clients' stocks. We give them market colour, let them know of market rumours and find liquidity from the other hundred or so floor brokerage shops,' our source told us.
At about 9:00 a.m. a floor broker starts getting orders and 'look' requests.
When someone asks for a 'look' near the open or close of the market, it means finding out a price for the open/close and/or what the buy/sell imbalance is.
If someone asks for a 'look' in the middle of the day, that means finding out some colour on the stock such as who's been buying, who's been selling, any rumours or news that's out.
A floor broker would ask a specialist to find this information out.
Then around 9:45 a.m. to 10:00 a.m. everything begins to settle down and algos and computer programs do most of the trading.
'We have all the algos and systems they do upstairs plus some. Also we have face-to face contact when trying to find the other side or complete a trade.'
'We each lunch while we work. It's too busy to leave,' the floor broker said.
There's a cafeteria downstairs.
At 4:00 p.m. the closing bell rings. The next ten or fifteen minutes are spent making sure everything closed OK and there are no problems.
At 4:15 the floor brokers head for the door. They're done for the day.
That's what they do, here are some things they don't do. First off, they don't trade mortgage-backed securities on the NYSE floor.
'That could not be further from the truth,' our source explained.
'It's not a matter of the floor vs. electronic trading. Almost all the trading we down here is electronic, but with a human touch.'
For example, all the brokers have hand-held computers like mini iPads, which are constantly updated with news releases.
They also have access to any and every OMS, algo, or computer program. What's more is some of the algos are only for floor brokers -- ones that take into account parity and the open/close, our source said.
The NYSE floor isn't like the rest of Wall Street (big banks and hedge funds). There are several people on the NYSE floor who didn't even go to college.
'Unlike other places on Wall Street, the floor has a unique collection of employees,' the source said.
'Not like investment bankers where almost everyone come from an Ivy League school, a lot of the guys down here never even went to college, but worked at delis, auction houses and other fast-paced environments.'
There's also a good amount of former athletes and army vets on the floor, our source said.
It's important to be able to remember orders and instructions.
It's also very important to have good work ethic.
'We don't care what college you went to, but if you're good with numbers, will be on time and not cry when someone yells at you. Those are more important things than your GPA and college,' the source said.
Even though there are fewer people on the floor these days, it's still a 'very fast-paced' environment.
The work environment on the floor is 'very fast-paced.' However, it's not like it was five or ten years ago.
These days there's more IM chatting than talking on the phone and more computers down here trading that human yelling and screaming, our source explained.
'There's great camaraderie between the guys down here. People always have each others back even though they may have fought that morning. It's kind of like a brother-sister relationship.'
Our source added that they do a lot of charity work and 'will always help out a fellow floor broker's sick kid or parents.'
Getting to be a floor broker can be 'tough.'
'These jobs are not posted on Monster.com. You have to know somebody to get down here.'