The Chicago Board of Trade was created on June 10, 1848 at a time of great economic and industrial growth in the United States. CBOT, as it is known, became a central meeting place for the buying and selling of agricultural goods, improving the lives of Illinois farmers by distributing their products on a large scale.
The floor, commonly referred to as “The Pit,” would often be filled with hysterical traders, bushels of grain, oats, barley, soybeans, corn, wheat and silver. In the pit, CBOT traders utilized hand signals and shouts known as “open outcry” to share information.
The original building that housed the Chicago Board of Trade was destroyed in the Great Chicago Fire of 1871, along with all financial records. After the fire, the building was reconstructed, but the location of the trading floor was moved to LaSalle Street in 1929.
The 1990s were a fruitful period for the Chicago Board of Trade, evidenced by the breaking of its own world record in trading by transacting 154 million contracts in 1990, 219.5 million contracts in 1994 and 281 million contracts in 1998. Despite CBOT’s powerhouse trading performance, the late 1990s brought with it uncertainty because of falling seat prices and the proposed integration of electronic trading. Purchasing a seat was necessary to get stock exchange membership in order to trade on the floor. The decline in seat prices was a sign of changing times for the trade floor
In 2005, the conversion of the Chicago Board of Trade to an electronic trading platform changed the once-bustling center to a relic of the past. The transfer of trading pits to electronic exchanges brought about faster trading and effortless data transfers.
In 2007, CBOT joined with the Chicago Mercantile Exchange, becoming CME Group Inc.
Read more about CBOT’s “open outcry” hand signals that became a mainstay of trading in the late 1800s and early 1900s:
