Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1917-02-21
THE BROKERS'
"FIVE-HOUR" DAY
How 1t Is Spent in Trading on
the Floor and in Discouraging
Fool Spectators"

A MAN walked into an uptown stock
"A brokers' office, selected a chair and sat
down. His attitude indicated that he was
n prospective customer lie glanced over
the board containing the quotations for
stocks as they had come over the ticker
until his glance was arrested by stock
that was selling for 80 n share. lie looked
carefully to sec that he had made no mis-
take, then got up and went in search of
tho stock broker.
Say he inquired. by way of greeting,
what stock is that selling for SEA rail-
road stock isn't it?"
ayes that's the stock of the - -
Railroad" replied the broker.
Huh, pretty cheap, isn't it?"
The broker told the prospective customer
that the railroad was in the hands Of re-
ce!vers that It's business was poor: that
n very large assessment, probably $50 "a
share, was likely to he levied on the stock
holders In the reorganization plan. In fact,
he gave him tho most pcssimistlc account
possible and concluded with tho advice
that tho man should have nothing to do with
tho stock.
Tho prospective customer had paid strict
attention His first question showed that
| he did not know anything about the prop
crty. and It was also evident that he did
not know anything about the stock market
or how business is done in the market
1T stu looks cheap" he said; buy me
100 shares"
Tho broker again advised him not to buy,
but TO no avail, und finally the order was
executed.
II SO happened that there was an ad-
vance I'm prices all through the market and
| tho Sc railroad stOCC went along. Then,
too, there were rumors in the financial dis
trict that something favorable" was In line
for the company. Tho result was that tho
stock, within a few days. sold at SIC n
share The man who had bought at So
was fortunate enough to sell AZ the top
price, and after his brokerage commission
and So state tax he had a net profit Of
about $3.50. lie went away happy he had
beat tho market But sight hero II can
be said that Il trader Of this kind. who
knows nothing about the market or the
stock which he buys will lose money on
other transactions
Five-EIour Day a Myth
This is just one Of the instances which
come up during a stock brokers' work in
day. Those who are not familiar with
! his work imagine that he has an easy
time. The Stock Exchange opens at 10
| o'clock and closes at 3 o'Clocli-the sessions
| never being lOngcr-and the unintiatcd
| figures that with only five hours in which
| to do business it surely must be an easy
| life. \ look behind the scenes will con-
vince any one that such is not the case.
This is how the stock broker puts in his
| day:
lie starts for his office In time to arrive
| there about o'clock or few minutes
| later. on the way downtown he has read
his morning paper carefully to see If there
are any news developments which might
have Il bearing ON the stock market. lie
| turns to the page carrying the market
| reports and quotations to see if any special
| news has come out about any company
| When he arrives at his Office he looks
| over the quotations of stocks in the London
| market to get the trend Of things over
| there. Then if he is the exchange member
| of the tirm-that is, if the membership on
| the Stock Exchange stands in his name
| he goes into the board room whore stock
| quotations are posted throughout the day
! for the benefit of customers and gets the
| orders to he executed at the opening of
| the Stock Exchange They include orders
! to buy ana sell. He writes some early gos-
| sip about the market and then leaves for
| the Stock Exchange in time to be there
at the opening.
| Each stock Is dealt in in different part
| of the room, known as the post" the name
| Of the stock traded i'm there being painted
on the post lie proceeds TO the post"
| where he has the largest number of orders
to execute He puts through his orders and
| then goes to other posts for the remainder
Of his transactions. As soon thereafter as
| he has a few minutes to spare he gets into
|
reporting the transactions and the Office in
| turn notifies the customer. The Office gives
| him any new orders and he goes over the
same routine. From time to time during
the day he reports gossip and rumors he
| picks up on the floor
| As business in stocks Is carried on by
word Of mouth. nothing more than n nod
| of the head being necessary to close a
| transaction involving hundreds of dollars
| and sometimes thousands, il can he undeIx
| stood that he must know his fellow brokers
| and the interests they represent. He must
recognize a fellow broker Immediately. lie
must have a good voice. make himself
easily understood and his hearing must
| be good. lie must show skill and judgment,
| as each onc-eighth means $3.50 on 100
shares, and this means much to a customer,
who is buying, say "at the market"
What a Broker Must Know
A memorandum of each transaction is
| kept by the broker, and at the end of the
| daV these memoranda are made up on a
slip of paper called the comparison sheet u
| and this sheet is compared with "a similar
| one of another broker who has bought or
| sold If the slips compare, then the trans
action goes through, but in the event Of
a dispute and the brokers fail to settle il
| tho whole thing Is placed in the hands of
| a special committee composed of members
| of the exchange, and the committees de-
| Clsion Is final
Tho broker must keep himself Informed
on earnings of different corporations-rail-
| roads, industrials and utilities-the rate OF
| dividend being paid, the return on the in.
yestment to the buyer, the possibility of a
change in the dividend rate, the present
market quotations, the supply of stock ant
the demand from buyers whether any stock
or bond issues are contemplated and, If so
the rights of present holders of stock anC
the advantages pertaining thereto, whether
repofiations are on for the consolidation o
| number of companies, how such consol
datlon would affect the stock of the differen
companies; and as much of the business, th
greater part in fact. is doEe on borrowed
| nancy. he must keep in mind the collatera
he has deposited for loans In addition L
keeping informed on the stocks which sci
eyery day, known as the "actives," he mus
know the market for inactive issues. IL
must know also the general market TO
bonds and how wheat cotton and coffe
are selling.
Bonds and the commodities are handle,
nv other members of the firm, each hous