Futures Pit Trading Vs Electronic Trading

[new_trader]

With the growing popularity of E-mini contracts will there be a steady decline in floor traders working in the pit? Perhaps I am just revealing how little I know about what goes on in the CME. I did read somewhere that there are institutional investors that use E-mini contracts to hedge positions.

 

[Directional]

there has already been a steady decline in floor traders and pit volume over the last four years.

Last year Eurodollar electronic volume exceeded the pit by a significant margin, when previously the pit had always been dominant.

S&P pit vol has been much lower than electronic for years and is still tailing off

 

[andycan]

there has already been a steady decline in floor traders and pit volume over the last four years.

Last year Eurodollar electronic volume exceeded the pit by a significant margin, when previously the pit had always been dominant.

S&P pit vol has been much lower than electronic for years and is still tailing off

The same is true on 30 year US bonds, electronic is far more liquid than the pit
also the grains now that they are electronic for the day session the volume is steadly increasing

 

[Rhody Trader]

You have to expect it's inevitable that floor trading will soon be a thing of the past. Even the NYSE is making moves to increase the amount of electronic trading, and they have been the slowest to get going in that direction.

 

[Directional]

add Nymex & Comex to the "slow to the party" list.

Nymex have oft touted the "transparency" of the pit traded contracts, but the pit is only transparent if you have a physical presence as a participant there.

Screen trading is the only marketplace that is truly transparent for every participant. It has to be that way. If you put the pit vs the screen, as LIFFE did with the Bund against Eurex, and the speed of execution, lower costs and reduced slippage of the screen win every time.

 

[Directional]

S&P pit vol has been much lower than electronic for years and is still tailing off

S&P pit volume is something like 20,000-50,000 contracts daily, where the screen does 1million contracts