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January 13, 2013
The New York Post is reporting that the low volumes of trading in equities, combined with other factors such as newer electronic exchanges, has caused the number of NYSE human traders on the floor to diminish from 3,000 in the year 2007, to only 300 now. The ICE acquired NYSE recently. Many believe that the NYSE is merely a “museum” and kept in business for the brand power alone. Don’t be surprised to see a new Cipriani occupy the NYSE building soon.
The NY Post article:
Floor traders drop from 3,000 to 300
- By JOHN AIDAN BYRNE, January 13, 2013
New York Stock Exchange floor traders already are an endangered species. But with the “ICE” age approaching, they worry about extinction. After the energy and commodities futures exchange upstart IntercontinentalExchange, or ICE, based in Atlanta, made its $8.2 billion bid to buy the venerable institution at 11 Wall St. last month, the traders spent the holidays pondering their futures.
And it’s not very bright. “Trading will go to the venue with the lowest frictional costs — and the venue with the lowest frictional cost is the one where there are no humans. The human is too slow to work in this electronic world,” said Diego Perfumo, of Equity Research.
TRADE DEFICIT: With the NYSE being taken over by ICE, floor traders worry their jobs will become extinct.
The latest numbers of floor traders by the NYSE bear him out. In 2007, there were 3,000 market makers and traders working the floor, but now, according to the NYSE, that number has fallen to 300. The introduction of computer trading systems has eliminated the need for human personnel.