WE’RE HEARING that anyone interested in finance should walk on the floor of the New York Stock Exchange and see the opening trading bell rung at least once in their lives.
One such opportunity to cross this off the bucket list happened last Monday, when mortgage technology vendor Ellie Mae got to ring the opening bell.
They have been ringing an opening bell on the NYSE since 1871 and a brass bell since 1903. These days, this just involves pressing a button (green, as it happens), but there’s no mistaking a venerable tradition.
There’s also no doubt that the trading floor of the NYSE is one of the cathedrals of commerce, especially with that 70-foot ceiling. It’s smaller than you might imagine, about the size of a medium-sized exhibit hall. And with electronic trading, it is much more subdued than you remember from those frantic mosh pit trading scenes in the movies. The overhead boards around the trading posts (arranged into roughly circular kiosks) are all prominently sponsored by advertisers, but how can you object to that in this bastion of capitalism?
Ellie Mae CEO Sig Anderman (congratulations, Sig and crew) and thrilled applauding family members, company executives and investors got the market started Feb. 4 on the actually fairly small balcony above the CNBC remote studio, where the cable channel’s “Squawk on the Street” show was underway.
When the Ellie Mae crowd came down to the floor, there was a demonstration of a stock sale at the Knight Trading area. Patrick King, Ellie Mae’s market maker there, bought some shares (Sig was the buyer) in a transaction that took just seconds. ELLI was trading at about 20.88 at the moment (it ended up showing a decline for the day but was ranked last year’s best-performing stock on the exchange).
There was also the chance to visit the remarkable NYSE Board Room (it is about the size of a basketball court with a table large enough for fifty) and hear stories about some of its artifacts. The clock in the room is the oldest piece of furniture at the exchange and used to be the official timer of the trading day. That explains why the minute hand is so much bigger than usual!
There’s also an urn that was a gift from Russian Czar Nicholas II after a $1 billion financing which was used to build the Trans Siberian Railroad a century ago. (Imagine how much that $1 billion would be worth today!) The next Russian government promptly defaulted on the bonds. The story is that when Mikhail Gorbachev visited the exchange many decades later, he asked that the urn be returned to Russia. The NYSE agreed, providing the Soviets made good the bondholders!
There was also a story about a terrorist attack attempted in the horse-and-buggy days but since the exchange is still, unfortunately, a terror target, they might want to retire that one (just as they never show disaster movies on airlines).
Still, it was quite an interesting time and something that anyone interested in finance should do once. Unfortunately, mortgage-related IPOs have been few and far between since the collapse, so you’ll have to keep a sharp eye open for your opportunity.
— Mark Fogarty