Life in the Pits: My Time as a Trader on the Rough-and-Tumble Exchange Floors

A former commodities trader gives an intimate glimpse into what it was like to work on the raucous exchange floors in the trading pits of Chicago and New York.

In 1989, Brad Schaeffer was working as an artist when his trader brother invited him to visit the floor of the Chicago Mercantile Exchange. Schaeffer promptly quit his job and became a clerk in that most iconic arena of raw capitalism. During the next six years, Schaeffer rose from clerk to trader, making markets on Eurodollar options in Chicago and heating oil options in New York. In that time, jammed literally shoulder-to-shoulder, he screamed, flailed his arms, hurled expletives, and pushed and shoved his way through his day. He was a keen observer of the methodology, incidents, and personalities that made the now-extinct open outcry trading pits such a unique place to do business.

Life in the Pits recollects those last, most glorious days when red-faced alphas in colorful jackets performed thousands of transactions per hour, even as computerized trading heralded the floors’ ultimate demise. Schaeffer recalls the uneasy camaraderie of working right next to fierce competitors, the sheer intensity of dealing in stacks of money changing hands with a simple scream or hand signal, and the hijinks, excesses, and collection of characters as colorful as the jackets they wore, giving the reader an intimate look into what life was like down in the financial mosh pits.

A worthy successor to Liar’s Poker and Reminiscences of a Stock Operator, Life in the Pits offers nuggets of wisdom on what makes a successful trader and the rules all must follow to survive in such an unforgiving environment. Schaeffer’s often hilarious, yet sometimes profound, reflections take us on his personal journey from penniless artist to moving millions of dollars’ worth of commodities in the blink of an eye—courtesy of being thrown into the crucible of the trading floors that are no more—and explore the lessons he learned along the way.

“Brad’s book about those now bygone days of the trading pits is both hilarious and insightful. Anyone interested in how markets behave, how to trade them, and the broader life lessons such a stressful work environment imparted should add this easily digestible read to their collection of business literature. I spent years on the floor, and this fun and lighthearted reflection on those truly unique business venues brings it all back to life. I highly recommend it.” —J. Robert Collins Jr., CEO of Mercantile Bank International and Former President of the New York Mercantile Exchange