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For Whom The Bell Tolls: The Demise Of Exchange Trading Floors And The Growth Of Ecns, Jerry W. Markham

Jerry W. Markham

This article describes the rise and fall of exchange trading floors on exchanges in both the stock and derivatives markets. The colorful “open outcry” trading in the “pits” of the Chicago futures exchanges and the bell ringing tradition opening trading on the floor of the New York Stock Exchange (“NYSE”) have long dominated the public perception of how those markets operate. Those scenes are now fast becoming history as the exchanges implement radical changes to their trading practices as the result of competition from electronic communications networks (“ECNs”). That competition has already forced the NYSE and the Chicago futures exchanges …