Many of the first 50-100 of our traders came directly from the Floor, back in 1992-93, and the primary reason was for "lack of edge". We got a bit of a head start with our "upstairs" trading while still physically located above/near the exchanges. This helped a lot with the evolution of "screen trading" - which means you "can" make markets, without "having" to make markets. Providing the liquidity/markets "back in the day" and responding to buyers and sellers, either scalping out or hedging. Now days, we have to be proactive with our trading, engaging in the strategies that the "big boys" engage in. Don
I just left the cboe floor within the last year and I like to hear what any former guys are doing now. Are there that many guys who go from options marketmaking to stock/futs trading?
I work for a MM (options) and I am amazed at how fast we are going electronic. The percentage of electronic vs floor traded volume is turning at a fast clip. Its just my opinion but I would think that learning to trade from the screen now would be the way to go. Its still gonna be a while before its all screen esp for the options but its def going that way. Maybe you could make markets @ the nymex for a year or two but eventually it will be gone as well. Plus the pain of trying to break into a new pit. (You know how the new guy can be treated) I just think you might have a small headstart over some of the guys still trading off sheets in the pit. Just my opinion. good luck Jim
I don't really know anyone who trades nymex/cbot/cme commodity products. I understand some of the guys trading options on interest rate products are still doing well. Only a matter of time before cboe/phlx/ise technology arrives and hits that side of the biz.
Mkt Mkr- Thanks again for your insight. To follow up on the pts. that you made: 1. How well capitalized are the large independent locals? 2. How low are their commissions? 3. What range of income can they expect to make?
well...the futures are already going electronic...options will surly be next...just a matter of how long, for now the options mkts in those pits are not listed, price descovery...you have to walk in to a pit and ask for the mkt...but who knows...then again the futures are not fungeble, proprietory products, so i dont know if the electronic exchanges can list them...isn't the ise trying that with the spx and there is an issue with intelectual property?
Yea...ISE is suing again. They want to list the S&P products but standard and poors/CBOE puts up a good fight. If they ever list them it will be the end of the spx. Hope its not anytime soon. (ohh.. im gonna get some sh*t for saying that) The spx is still a great pit but things are getting tighter every single day. jim
you know...i dont wish anything bad for anyone...i do believe in carma, but the fact is, or at least i think...alot of the electronic mm that have never been on the floor have never seen a crash...when it comes, and they do every so often...i think the experienced floor guys will get their props...but other then that, the game has changed...much more technical, spreading index against index againts components...different game....