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Pit

• A specific area of the trading floor that is designed for the trading of commodities, individual futures, or option contracts.

• Is the area on the floor of an exchange where trading occurs. It is also known as the ring.

 
 Embedded terms in definition
 Exchange
Floor
Futures
Option
Ring
Trading
 
 Referenced Terms
 Ex pit: Refers to a transaction outside the Pit or ring. This is permissible for bona fide hedging purposes or to allow for a smooth transfer of accounts between brokerage firms. This type of transaction is under less scrutiny than ordinary transactions because there is no public offering of the positions.

 Futures market: A continuous auction market in which participants buy and sell commodities contracts for delivery on a specified future date. Trading is traditionally carried on through open outcry and hand signals in a trading Pit or ring.A market in which contracts for future delivery of a commodity or a security are bought and sold on an organized futures exchange such as CBOT, CME.A market in which contracts for future delivery of a commodity or a security are bought or sold.

 Ring: Is the area on the floor of an exchange where trading occurs. It is also known as the Pit.

 Rings: Trading arenas located on the floor of an exchange in which traders execute orders. Sometimes called a Pit.

 
 Related Terms
 Ex pit
Pit committee

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