Pit Psychology

Less quantifiable than a high volume and liquid market are the psychological issues unique to the trading pit and how these are to be replicated on a screen-based trade system. Many traders, experienced with both the pit structure as well as GLOBEX, assert that on the floor there is information meaningful to the negotiation process which cannot be found on GLOBEX. One example is noise or information trading. This refers to the increased noise in an extremely active market. Traders sometimes choose which pit and its respective contract to risk their money in by the noise associated with it. On a screen based system such as GLOBEX there is no way to hear price movement. There is no replication of the hundreds of shouting voices, waving hands, or stamping feet that one commonly sees on the trading floor. Thus, it can be argued that this lack of auditory and visual stimuli on GLOBEX may preclude some involvement by traders seeking profit.

Electronic futures markets versus floor trading: Implications for interface design