The loud, colourful traders who jostle for deals in Chicago’s famed open-outcry pits now face an even greater threat than the advent of electronic dealing systems – the algorithmic trade, says the director of a new documentary charting the demise of floor trading.
More a living funeral than a eulogy, the film “Floored” that debuted May 7 recounts the transition from the bustling salad days of burly alpha males to a market dominated by faceless computer-based traders across the globe.
It’s sink or swim for the veteran pit traders featured in the film, struggling to adapt from a world of multicoloured jackets and arcane hand signals to executing trades with a series of keystrokes at home in the suburbs.
“The older guy, the guy basically like me who is not computer orientated, they’re gone – they are out of the business,” Joe Bedore, vice-president of floor trading for INTL/FC Stone, told Reuters.
But it’s not the final chapter, warns director James Allen Smith.
“We talk about the floor going to a mouse. But obviously what’s happened from there is the mouse is now going to completely automated trading,” Smith, 37, said in an interview before his first film shows in narrow release in Chicago, New York and Washington.
“Let’s say five years ago you jumped off the floor and started trading on a computer, well now you are getting smoked by automated systems. That’s the next chapter.
“It just takes a totally different kind of person to stay on your feet and scream and yell all day in a brooding environment than it does to sit patiently and quietly in a room and click a mouse,” Smith said.