TRADING ON THE STOCK EXCHANGE FLOOR

When an individual wants to place an order to buy or sell shares, he contacts a brokerage firm that is a member of the Exchange. A registered representative or "RR" will take his order. He or she is a trained professional who has passed an examination on many matters including Exchange rules and procedures.

The individual’s order is relayed to a telephone clerk on the floor of the Exchange and by the telephone clerk to the floor broker. The floor broker who actually executes the order on the trading floor has an exhausting and high-pressure job. The trading floor is larger than half the size of a football field. It is dotted with multiple loca­tions called "trading posts".

Every stock traded on the Exchange is assigned to a specific post. The floor broker proceeds to the post where this or that particular stock is traded and finds out which other brokers have orders from clients to buy or sell the stock, and at what prices. If the order the individual placed is a "market order" -which means an order to buy or sell without delay at the best price available - the floor broker sizes up the market, decides whether to bargain for a better price or to accept one of the orders being shown, and executes the trade - all this happens in a matter of seconds. Usually shares arc traded in round lots on securities exchanges. A round lot is generally 100 shares, called a unit of trading, anything less called an odd lot.

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Yours sincerely,

AlexSandra