Doing business as usual At Ferris, Baker Watts' Baltimore office, Dow's chaos met with calm

September 02, 1998|By William Patalon III | William Patalon III,SUN STAFF

Call it the calm after the storm.

Activity on the trading room floor at the Baltimore office of brokerage Ferris, Baker Watts Inc. was orderly and relatively sedate yesterday, one day after the Dow Jones industrials shed 512.61 points in its second-worst point drop ever.

Even during Monday's precipitous plunge, Ferris, Baker Watts traders say composure was the order of the day in their ninth-floor sanctum in the Legg Mason building downtown: a place where the players have pet nicknames for stocks and each other, try to fake out their counterparts at other local firms, and occasionally bark out orders for stocks -- but only "occasionally," since computers now execute most of the orders once processed by hand.

For an outsider, yesterday's calm was a bit surprising.

"It was a lot busier this morning," said John R. Boo, 37, "Boo" to his colleagues, and the head of the Nasdaq trading desk for the Washington-based brokerage.

Among those around Boo are "Lou" -- principal trader John P. Shaduk -- and "Moose" -- new trader Bob Bianco -- who all stare at their computer screens trying to divine the market's secrets. Their hope: to make the best deals possible for the firm's clients and the most money possible for Ferris, Baker Watts.

Like many regional brokerage firms, Ferris, Baker maintains its niche by "covering" the stocks of smaller area public companies that the bigger firms -- such as Merrill Lynch, Prudential, (P Goldman Sachs -- don't follow. It also "makes a market" in many of these stocks, meaning the brokerage house makes sure BTC investors can trade these stocks easily. Sometimes that even means "taking the other end of a trade" -- buying or selling a stock -- when no one else will.

That's made for some tough times for the brokerages that specialize in the small- and mid-capitalization stocks that were savaged months ago. The stocks of these smaller firms have "been weak for months," said Boo. "This isn't something that just happened [Monday] with the Dow's fall. [Monday] was not as drastic a shock to us as it might have been to other people."

Trading floors -- even small ones like that of Ferris, Baker -- have a culture and lingo all their own. Lunch is eaten at the desk. Especially now, with the stock market so volatile, a visit to a restaurant is an hour that could lead to thousands in losses and isn't worth the risk.

Buy or sell orders are sometimes called out in "steenths" or "teenies" -- slang for sixteenths of a point -- because "sixteenths takes too long to say," said Bianco, the trader who goes by "Moose."

And pet stocks pick up pet names. Mercantile Bankshares Corp., for instance, is known as "Mr. Bank" because of its stock symbol "MRBK." (At any brokerage house, a stock's nickname can also reflect the displeasure of traders or brokers with its recent lackluster performance.)

Late yesterday morning, Maria L. Hunt, Ferris, Baker's institutional trading vice president, placed "four" of "Mr. Bank" for a client at "15 teenies." The trade was barked out across the room. Since the institutional desk deals in bigger blocks of stock, everyone understood that the "four" meant 4,000 shares.

And since every trader knows the "handle," or base dollar price, of each stock he or she follows -- $27 for Mercantile -- all understood the trade came off at 27 and 15/16 dollars.

Morry A. Zolet, a broker who works for The Westheimer Group of Ferris, Baker -- a floor down from the traders -- says the firm's traders get the best prices possible on stocks he is buying or selling for his clients -- especially those the brokerage house makes a market in.

Pub Date: 9/02/98

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