Arb (gesture)
Encyclopedia
Hand Signaling, also known as arb or arbing, short for arbitrage, is a system of hand signals used on financial trading floors to communicate buy and sell information in an open outcry
trading environment. The system is used at financial exchanges such as the Chicago Mercantile Exchange
and the American Stock Exchange
(AMEX). The AMEX is the only U.S. stock market to permit the transmission of buy and sell orders through hand signals.
Traders usually flash the signals quickly across a room to make a sale or a purchase. Signals that occur with palms facing out and hands away from the body are an indication the gesturer wishes to sell. When traders face their palms in and hold their hands up, they are gesturing to buy.
Numbers one through five are gestured on one hand with the fingers pointing directly upwards. To indicate six through ten, the hand is held sideways, parallel to the ground. Counting starts from six when the hand is held in this way. Numbers gestured from the forehead are blocks of ten, blocks of hundreds and thousands can be indicated by repeatedly touching the forehead with a closed fist. The signals can otherwise be used to indicate months, specific trade option combinations or additional market information.
Rules vary significantly among exchanges; however, the purpose of the gestures remains the same.
Open outcry
Open outcry is the name of a method of communication between professionals on a stock exchange or futures exchange. It involves shouting and the use of hand signals to transfer information primarily about buy and sell orders...
trading environment. The system is used at financial exchanges such as the Chicago Mercantile Exchange
Chicago Mercantile Exchange
The Chicago Mercantile Exchange is an American financial and commodity derivative exchange based in Chicago. The CME was founded in 1898 as the Chicago Butter and Egg Board. Originally, the exchange was a non-profit organization...
and the American Stock Exchange
American Stock Exchange
NYSE Amex Equities, formerly known as the American Stock Exchange is an American stock exchange situated in New York. AMEX was a mutual organization, owned by its members. Until 1953, it was known as the New York Curb Exchange. On January 17, 2008, NYSE Euronext announced it would acquire the...
(AMEX). The AMEX is the only U.S. stock market to permit the transmission of buy and sell orders through hand signals.
Traders usually flash the signals quickly across a room to make a sale or a purchase. Signals that occur with palms facing out and hands away from the body are an indication the gesturer wishes to sell. When traders face their palms in and hold their hands up, they are gesturing to buy.
Numbers one through five are gestured on one hand with the fingers pointing directly upwards. To indicate six through ten, the hand is held sideways, parallel to the ground. Counting starts from six when the hand is held in this way. Numbers gestured from the forehead are blocks of ten, blocks of hundreds and thousands can be indicated by repeatedly touching the forehead with a closed fist. The signals can otherwise be used to indicate months, specific trade option combinations or additional market information.
Rules vary significantly among exchanges; however, the purpose of the gestures remains the same.