Nameless Game

Orders on the London Stock Exchange may be and often are executed by clerks substituting for regular members. On the New York Stock Exchange, only members may buy & sell, and on dull days the clerks have even a duller time than brokers. A year ago when trading became rutted at about 700,000 shares per day, the floor clerks in desperation devised a nameless game which has almost all the elements of real trading. For a long time the idle floor members ignored the game, continuing to spend the daily five-hour Stock Exchange session at backgammon or horseplay. After the turn of the year, the members suddenly took up the clerks' game, and by last week there were often more brokers playing than could be found at the U. S. Steel post. The game:

Slips of paper numbered from 0 to 18 are placed in a hat and eight brokers draw. The rest of the slips are discarded. Trading in a hypothetical stock then begins. At the end of the game the sum of the numbers on the eight slips represents the closing price of the stock but in the meantime each broker knows only his own number. The lowest possible total for any eight slips is 28 (the sum of the numbers from 0 to 7). Highest is 116, the average 72. Thus, if a broker draws a very low number, he knows that the hypothetical stock will certainly close at less than 116 and probably at less than 72. So he sells short 1,000 shares at, say, 70. Since one point change in price is fixed arbitrarily at 1-c- per 1,000 shares, he will win 10-c- if the sum of the outstanding slips turns out to be 60; or lose 10-c- if the figure is 80. And he will win or lose from the person who bought his hypothetical stock.

In practice, however, he may trade in & out throughout the game, and any other idle broker may join in, although an outsider does not have the advantage of holding a numbered slip. Instead of settling individual transactions, each broker records his trades as he would on the Floor, turning over to a volunteer "clearing agent" for "settlement" at the end of the game his "bought" and "sold" memoranda. The game goes on until trading peters out or the real stockmarket stirs in its sleep. Losses have run as high as $200 in a single game but the average gain or loss is between $10 and $20 per "session." Lately the Stock Exchange Governors banished the game to the smoking room but there two groups are usually in session. For peeking at a numbered slip, one broker was barred from all future games.

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