BUYING 1 | | f ‘A trador wishing to BUY indicates this by mnaeens turning the palm of the hand TOWARDS the body and away from the potential seller, INTRODUCTION ‘Trading of equity and interest rate futures + and options on LIFFE takes place in the pit : ’ on the trading floor of the Exchange by ‘means of open outcry. ‘A trader stands in the pit associated with the contract which he is buying/selling and shouts his intended trade to the other traders in that pit, q Hand signals are used as a means of SELLING complementing trading procedures. The ee hand signalling system is never intended to A trader wishing to SELL indicates this by be used as an alternative to ‘open outcry’ but turning the palm of the hand AWAY from the provides a valuable secondary means of body and towards any potential buyer. communication for both Members’ traders and LIFFE officials. Hand signals are used to convey four basic types of information: © Whether a trader wishes to BUY or SELL. © The PRICE at which he is willing to trade. © The QUANTITY or number of contracts ; that he wishes to trade. © The contract MONTH in which he is interested in trading.PRICING ‘The price indicated in the pit represents the last digit(s) of the price as it appears on the electronic display boards positioned around the sides of the Exchange trading floor. Prices are conveyed by hand signals in FRONT of the body. The prices 1-5 are indicated by the appropriate number of fingers held 2 3 4 vertically and 6-9 by holding one, two, three or four fingers horizontally . . . 6 f 8 © and ‘00° byadl clenched fist, shown, The price 10 or zero is shown > bya clenched fist...Quantity signals are shown by using the same fingers and numeric code as for prices but with units being registered on the chin, for example... i and tens on the forehead. ... 10 Intermediate values are indicated by a combination of tens and units... 10+6=16 N.B. Prices/quantities shown on pages 2,3,4 and 5 are in the buying or BID position. A SELLER would use the same price signals with hand reversed (ie palm away from the body) known as an OFFERe.g...-MONTH 6 TRADE 7 A trader signalling in the pit does not normally Whon a trader is satisfied that his bid/offer has have to indicate the month in which he is been accepted by another party he signals the interested. It is accepted that he will be trading completed trade by moving the price hand-signal the near or spot month (ie the next month on the he has been using from side to side. delivery cycle of the contract in which he is dealing). There are occasions, however, when a trade will | be for a far month and it is then necessary to indicate in which month a trader is interested. | The LIFFE delivery cycle is MARCH, JUNE, ‘SEPTEMBER, DECEMBER, each month having its own hand signal. June a SeptemberFT-SE 100 = The hand signals already shown represent those in general use on the trading floor. However, = because of the different way in which they are priced certain controcts require a variation on these signals. FT-SE 100 can be quoted to 0.5 on the decimal scale or ?, and therefore q requires signals which reflect this. For example . . .LONG GILT & US T-BOND 10 OPTIONS u ‘These contracts are priced in 32nds and ; therefore in order to differentiate betwoen ‘31° ey imeem signal ero those. magt commonly and ‘01’ a special signal is used to signify ‘31’... RUTURES: a ‘An OPTIONS trader, although he uses the same price, quantity and month signals, indicates an interest to trade a CALL or a PUT by special signals... * Put N.B. Again signal shown is n Bld postion Oiter ould be pan outearsThe hand signals contained in this booklet are those recognised by The London International Financial Futures and Options Exchange and only these are valid for pit trading. Some Member companies, however, may have devised their own extra signals for in-house communication only. © uirre wee [All popstar i eet inthis booklet shall be ested in LFF ‘alates gts nlaing tt sihnt ataon by peers ‘esgner copyright trode mar, sie mark. connate wih he boklt ‘Slfanote vested in LTE "Nolte LIMP, ao its servants nd pent responsible for any oor ot ‘mons coated ais booklet ie spud forint purpons ands ot constitute invasions sic, Al Solon, ‘caps aleulatons cntae i this bool ae tor edanos pips fat be ete a finite: Whilst all emanable cares ial artes a not tang he tne ‘et pullin, to aby ib acento by CLIFF forthe po information onained hrsn in any clcumsnces once with orton tang or theese, LFF reseres the righ to slr any of trl contact Photos and printed by Apall Ott, were 53 Central Stee. Lando ELV UAD Telephone: 073-490 6065,