Dan Brecher
Counsel
212-286-0747 dbrecher@sh-law.comFirm Insights
Human Financial Traders May Be Going The Way Of The Dinosaur
Author: Dan Brecher
Date: February 16, 2015
Key Contacts
Back
In the age of technology, financial traders are quickly going the way of the dinosaur. Most recently, CME Group Inc., which owns the Chicago Mercantile Exchange and New York Mercantile Exchange, announced that it plans to close most of its trading pits by July 2015. The floor-based S&P 500 futures market, as well as some options on futures, will remain open.
As portrayed by Eddie Murphy and Dan Aykroyd in Trading Places, trading pitswere once jam packed with rowdy financial traders wearing colorful jackets shouting commodities prices and flashing hand signals. “Well, this is it, the last bastion of pure capitalism left on earth,” Aykroyd remarks as they enter the pits.
Today, less than 500 traders and clerks work in CME pits. While some traders were angered by the decision to shutter the pits, the news does not come as a complete shock. Most of the traders on the Chicago Mercantile Exchange and New York Mercantile Exchanges already work remotely using computers, at least part of the time. According to CME, open-outcry volumes have dropped 75 percent since 2008 and now comprise just one percent of its futures volume.
Floor traders aren’t the only positions at risk. As automated trading by computer algorithms becomes more sophisticated and the pace of trading continues to escalate, computers are expected to replace a large segment of financial services workers over the next ten years. In many respects, humans are simply too slow to compete with technology when it comes to global markets that operate around the clock.
Of course, electronic trading is not without risk. In the “Flash Crash” of May 6, 2010, the U.S. equity market lost $800 billion in a matter of five minutes, although it was largely able to recover in 30 minutes. More recently, Facebook Inc.’s initial public offering on the Nasdaq Stock Market was hampered by software glitches. Should robot trading become the new normal, our financial regulations will also need to be updated.
- Business attorney New Jersey
- Business attorney NYC
- NJ attorney Scarinci
- Scarinci Hollenbeck
- Securities attorney NYC
- Locations: Red Bank, NJ, Little Falls, NJ, New York City, Washington, D.C.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
What to Do If You Are Impacted by a Retailer Bankruptcy Part 2
Over the past year, brick-and-mortar stores have closed their doors at a record pace. Fluctuating consumer preferences, the rise of online shopping platforms, and ongoing economic uncertainty continue to put pressure on the retail industry. When a retailer seeks bankruptcy protection, a myriad of other businesses are often impacted. Whether you are a supplier, customer, […]
Author: Brian D. Spector
The Current Administration's Proposals for the Financial Services and Banking Industries Will Affect Your Business
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
Tips for Commercial Landlords Impacted by Wave of Retailer Bankruptcies Part 1
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
How Understanding Bankruptcy Trends Can Benefit Your Business
The bankruptcy legal landscape presents both challenges and opportunities for businesses navigating financial distress. Understanding current bankruptcy trends can help businesses make more informed and strategic decisions. Corporate Bankruptcy Filings Trending Upwards Bankruptcy filings continued to trend upwards in 2024. According to statistics released by the Administrative Office of the U.S. Courts, personal and business […]
Author: Brian D. Spector
SEC Takes Actions Against Issuers for Failure to File Form D
In December, the U.S. Securities and Exchange Commission (SEC) announced charges against two privately held companies for failing to file a Form D notice, which is generally utilized for exempt securities offerings. Here, the SEC’s enforcement sends a strong message: compliance with regulatory requirements is not optional and failure to comply can have significant consequences. […]
Author: Kenneth C. Oh
Redefining Labor Relations: NLRB's Pivot from Abruzzo’s Memoranda
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
Author: Matthew F. Mimnaugh
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.