Another colorful market mechanism looks set to bite the dust, replaced by electronic/computerized trading.
The WSJ has the story:
After 144 Years, London Metal Exchange Proposes Closing Trading Ring By Joe Wallace
"The London Metal Exchange is proposing closing its open-outcry ring, where traders have swapped metals like copper and lead using shouts and hand signals for 144 years, in a bid to attract more financial players.
"The LME temporarily closed the ring when Covid-19 ripped through the U.K. in March, judging the tight circle of red couches that dozens of traders crowd around to be a health risk. The exchange, owned by Hong Kong Exchanges & Clearing Ltd. 388 3.94% , is now proposing shutting it for good.
"The ring began life when the LME was founded above a London hat shop in 1877, though its origins date to sawdust circles around which merchants bought and sold metals in the early 1800s,
...
"If the change goes through, the LME would join CME Group’s New York Mercantile Exchange, which closed its open-outcry trading floor in lower Manhattan in 2016. The LME said it planned to lay out its next steps by the end of June after feedback from market participant
...
"Trading in the ring takes place in frenetic five-minute sessions. To avoid miscommunication amid the hubbub, dealers use hand signals to convey orders. Three fingers facing down, for example, indicates that they would like to sell metal for a price ending in three. It is assumed that every dealer knows the previous digits.
"Though much trading had migrated to the LME’s electronic platform before the pandemic, many market participants still routed orders through ring members. Some thought that open-outcry remained the best way to set closing prices that are used as reference points in metal contracts globally"
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