Inside Europe's last 'open-outcry' trading floor

The adjacent 150-year aged contented takes spot successful a ellipse of red-leather benches. Photo: BENJAMIN CREMEL / AFP
Source: AFP

In an epoch wherever machine algorithms automate trading astatine breakneck speeds, a dwindling fig of London's metallic traders inactive behaviour concern in-person by shouting orders crossed Europe's past alleged open-outcry trading floor.

The adjacent 150-year aged contented takes spot successful a circle, oregon pit, of red-leather benches -- called the "Ring" -- wherever the regular planetary prices of copper, nickel, aluminium and different metals are acceptable astatine the London Metal Exchange (LME).

Seconds earlier the frantic trading begins, a trader rushes in, puts connected a necktie arsenic per the obligatory formal code, and heads towards 1 of the booths circling the Ring.

Then, sheets of pencilled figures and banal marketplace orders are handed out.

Once the doorbell rings, signalling the commencement of trading, no-one is allowed to commercialized online oregon usage mobile phones. They can lone pass with the extracurricular satellite via landline phones.

The 5 minutes of trading per metallic is "a spot similar playing poker", said Giles Plumb, a trader astatine fiscal services steadfast StoneX, who has tally its copper portfolio for 21 years.

'Flurry of activity'

It starts disconnected calm, with seemingly unbothered traders sitting quietly.

As the minutes tick by, "you effort not to look astatine your watch, to marque it look similar you don't person an bid to place", Plumb told AFP.

But arsenic the last seconds of the allotted clip approach, the Ring erupts.

"There's this large flurry of activity," Plumb said, arsenic traders leap up from benches and statesman shouting.

Once the doorbell rings, signalling the opening of trade, no-one is let to commercialized online. Photo: BENJAMIN CREMEL / AFP
Source: AFP

They basal up and thin towards the idiosyncratic -- astir exclusively a antheral -- they're making a woody with, making definite to support 1 bottommost glued to the spot -- different regularisation of the Ring.

"To beryllium good, you've got to beryllium alert of who's doing what astir you, you request to rapidly process accusation and you person to beryllium wide and audible," Plumb said.

"By now, I tin archer people's voices and I cognize who's doing what adjacent without looking astatine them."

Behind them, brokers talk to clients connected landlines, immoderate holding 1 telephone to each ear, repeating orders portion taking caller ones.

Despite the tumult, Plumb says the sessions are "less aggressive, little competitive" than erstwhile helium began his career.

At its peak, helium explained, the "pit would beryllium afloat of 22 brokers, 300 people, immense partition of noise. So you could hardly perceive yourself think".

'The conflict is lost'

Now, lone 8 companies and a fewer twelve radical inactive enactment successful these age-old sessions, arsenic online trading killed disconnected astir of the world's open-outcry markets.

The London Metal Exchange and its open-outcry contented began towards the extremity of the 19th century, pausing lone during World War I and again during the Covid-19 pandemic.

The LME wanted to displacement wholly to physics trading successful 2021, but faced unit from its remaining traders to support the contented alive.

The speech compromised by keeping 1 of its 2 regular in-person sessions, arsenic agelong arsenic much than six members are consenting to participate.

The London Metal Exchange and its open-outcry contented began towards the extremity of the 19th century. Photo: BENJAMIN CREMEL / AFP
Source: AFP

"Those wanting to commercialized successful the Ring proceed to bash so, but these days astir of the LME's trading takes spot electronically," the speech said successful a statement.

There is nary longer immoderate crushed to proceed open-outcry trading, explained Thierry Foucault, prof of concern astatine HEC Paris concern school.

Electronic trading is "technically superior and allows for greater marketplace liquidity, arsenic good arsenic little intermediation costs", helium told AFP.

In immoderate cases it has persisted for bully reason, helium said, "particularly successful highly specialised markets", similar metals, wherever the fig of adept operators is precise limited.

However, "over time, the conflict is lost".

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Source: AFP