cbothandsignals

8/3/2019 cbothandsignals

1/11

The Important Role of Hand SignalsThe usc of hand signals is an aspect llf futurestrading that has ah\ays f


2/11

Designating Quantity in FinancialFutures &OptionsTraders in financial futures and options call outquantity during open outcry trading to indicate thenumber of contracts they \\ant to buy or sell. Toensure accuracy. they abo c:qwcss quantity throughhand signals. as i lustratcd bdm\.

1CONTRACT 2 CONTRACTS

3CONTRACTS 4CONTRACTS

2

5CONTRACTS

' -. . ---: ::::;i.

7CONTRACTS

I

9CONTRACTS

3

6 CONTRACTS

8CONTRACTS

I \II \.\.i10 CONTRACTS

Cli! l f i l l l iL ' tf Oil j)(('.!,L' .f


3/11

20 CONTRACTS

iI

40 CONTRACTS

60 CONTRACTS

30 CONTRACTS

50 CONTRACTS

\70 CONTRACTS

80 CONTRACTS 90 CONTRACTS

I 100 CONTRACTS I 1,000 CONTRACTS


4/11

Combining Quantities inFinancial Futures & OptionsI u 1 1 1 d i c ~ l l L ' l'lllllj1Ullllll L j l l c l l l t i t i l ' ~ ~ u c h c l ~ I 1 coll-t r : ~ c h ur ~ I ' L ' l l l l t r ~ t l ' h . tl'cidl'l'' u ~ e cl comhlllcltll111ui' h ~ t l l d ' ' t ' ll:tkhn L'\Cllllj1k. 11hen ~ i g 1 1 ~ t l i 1 1 g ](1 n m t r ~ t e h . the111de\ linger held tll till' 1 ( 1 1 - l ' h l ' ~ t d tu llldil'ctlL' I()u m t r ~ t c h . ctlld thL'Il the li11gl'l' j1Lteed h o r i ; o l l t ~ t l l ~ tu till' chill tl1 l l l d i L : ~ t e hl'lllltrach l\11 tlltctlul' I 1eolltrctch.LikL'\\ i ~ l ' . ti11 l'lllllrclch. t\\ll tingeh uie hl'id totill' liHehectd to JJHiicalL' ~ ( I l ' l l l l t r ~ l l ' h . cllld the11 .\l i 1 1 g e r ~ ~ t r e ilL'Id i l l l l ' l l l l l l L t l l ~ tu tile chin ttl i11dicalL'X eulltrctl'h t\11 t u t ~ t l ui' etllltl'cll'h.

10 CONTRACTS

20 CONTRACTS

6 CONTRACTS10+6=16

\I8 CONTRACTS

20 + 8 =28


5/11

Indicating Price in FinancialFutures &OptionsFuturesPncing in T r c a ~ u r : bumb and n u t c ~ in pninhand ~ 2 d ~ . Lach puint ' ~ l i u c d at S 1.000 and each_>2d at S_> 1.2). lkcause each llltenal bet\\een I J2a m i ~ I 32 needs tube ~ i g n ~ l i e d . 1i1any uf the handsignab ~ 1 r c r e p e ~ l l e d at\ ariuus price in ten ~ l i s . Olicntimes. traders alternate \crtical and hori;ont ~ l i gestures tu clearly d i l k r c n t i ~ l t c prices. i.e .. Iis indicated by the imlc\ finger held \Crtically. but(J .12 is shl1\\ n hy the indc\ linger held h o r i ; o n t ~ l l l y . .\ \ cr: common price in ten al is the mm e bel\wen-'I 3.2 and I 3.2. It may be traced and retracednumerous times in a single day. To minimi;c confusion. it is customary that 31 32 is signaled\\ iththe pinky linger and that I 32 is signaled\\ ith theindc\ tingcr.\\hen the market is at e\cn. e.g . 97-00. theclenched list is held \Crtically and mo\cd fromside to side \\ith the thumb e\tcmkd to clearlyindicate a price of e\ en.It is critical that traders and brokers follow themarket carefully and be \ery clear with their handsignals and open outcry.

1/32,11/32,21/32 2/32, 12/32, 22/32

8

3/32, 13/32, 23/32 4/32, 14/32, 24/32

5/32,15/32,25/32 6/32, 16/32, 26/32

7/32, 17/32, 27/32 8/32, 18/32, 28/32

continued on JWge I i9


6/11

9/32, 19/32, 29/32

30/32


7/11

Combining Price and Quantity inFinancial Futures &Options13u)crs indicate price first and then quantity.Sellers du _just the oppusitc: indiGllc qw1ntit) firstand then price.Traders ~ ! I so usc an important \ crbal distinctionthat s h m \ ~ if the\ \ \ ~ l i l t to bll\ nr sell. Buvcrs bid. .price FOR quantity. Sellers otTer quantity .\Tpncc.

Buyers Bid Price "for" QuantityFOR

9/32

1. .:n 'f 1 11 r !\ l u ry( \I v _I I\\\ I // I

20 CONTRACTSThe outcry \\ould be "9 for 20."

Sellers Offer Quantity "at" PriceATem; ____ _.

r : : ~ \II I/20 CONTRACTS

The outcry \\ould be "20 at 9."

12

9/32

Designating Quantity in GrainFutures &OptionsIn grain futures. each tingcr represents nne c u n t r ~ 1 c t nf 5.000 bushels. Traders call out the numbL'r tlfbushels rather than the number nf contrach t r ~ I d c L I . For C'\ampk. traders refer tn one c u n t r ~ 1 c t uf 5.000bushels ti\ c" r ~ l l h c r than "tlnc."In grain uptinns. traders call nut the number nfcontracts traded rather than the number nf bushck(]rain nptinn hand signab for quantity arc simii


8/11

15(15,000 bushels/3 contracts)


35(35,000 bushels/

7 contracts)

14



40(40,000 bushels/

8 contracts)

45(45,000 bushels/

9 contracts)

100(100,000 bushels/

20 contracts)



9/11

Indicating Price in GrainFutures & OptionsGenerally traders signal only the last fraction of the\\hole price. Grain futures are traded in ticks of l/4cent per bushel. Options on grain futures use ticksthat are half those of the underlying futures. Thismeans ticks in options on soybeans, corn, wheat,and oats are 1/8 cent.In the grain markets, the price at which a trader ismaking his bid or offer is usually shO\vn by thefingers held in a horizontal (sideways) position.

Futures

J

1/4 1/2

3/4 full cent

16

Options

1/8 2/.8 or 1/4

- - - - -

3/8 4/8 or 1/2

- - - - -

1 5/8 6/8 or 3/4

- - - - -

7/8 I full cent


10/11

Combining Price and Quantity inGrain Futures &OptionsTraders and brokers use combinations of hand signals for price and quantity to indicate the transaction they wish to make. As previously mentioneLlgrain prices are usually signaled with horizontalgestures, while quantities are usually shmvn withvertical gestures.

Buyers Bid Price "for" QuantityA trader vvho is buying would first signal the priceand then the quantity.

1/2 CENT15

(15,000 bushels/3 contracts)

The outcry would be "A halffor 15 ." e

Sellers Offer Quantity "at" PriceA trader who is selling would first signal quantityand then price.


AT

The outcry would be "15 at a half."

1/2 CENT

This presentation is not all-inclusive. Theseare the most commonly used hand signals inthe financial and grain markets. Variations onthese signals are used in other Chicago BoardofTrade futures and options markets.


11/11

EM91-41995, Board of Trade of the City of Chicago

The information in this publication is taken from sources believedto be reliable. but it is not guaranteed by the Chicago Board ofTrade as to accuracy or completeness, nor any trading result. and isintended for purposes of information and education only. Nothingherein should be considered as a trading recommendation of theChicago Board of Trade. The Rules and Regulations of the ChicagoBoard of Trade should be consulted as the authoritative source onall current contract specifications and regulations.2.95.1 0000

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