There is a difference between trading 1 single contract and 25 contracts at a time. When you start executing 10 or more contracts of a particular spread at a time, then tell me more about your experience. And I do trade electronically when the volume is there and the market not too fast. This means I trade electronically and in the Pit. You can do both by the way. Since you've not traded in the Pit, how can you conclude that trading electronically is faster than the Pit or vise versa?
It was a mistake to not qualify my statement with regards to size. With ag spreads you'll often have a problem with more than 3-5 contracts, and that's the whole thing with floor traders: they provide the liquidity at a price of some ticks (which of course is fair if they're not too greedy).
Obviously, you get electronic fills in milliseconds whilst reports of fills from the floor takes a good while longer - you cannot convince me otherwise. Not to mention the need to check that there's no human error.
And of course, electronic trading is much slower if you want a position of 20 contracts in a spread - leaving you to bid five times for 4 contracts. That certainly is slower than going to the pit.
SPECIALIZE IN 3 - 6 MARKETS
...You cannot trade them all. You will miss many important moves if you monitor all these trades. My suggestion is to select two products in Agric, two in Energy and two in Finance, making a total of six to diversify your portfolio. Anything more is excess work and brings inefficiencies. As a matter of fact, Warren Buffet said that you should Put all your eggs in one basket and protect that basket with all you have. In trading, it's not such a bad idea
My trading style in equities (which is what I really do) is somewhat similiar - when I find cases that I know inside and out and am totally confident in I don't have a problem pushing for size and being concentraded on just a few positions. So I agree with you and Buffet.
I don't know if I'll narrow down my markets later, my plan is already in place until April next year. It does cover a wide variety of markets, but it's not based upon doing a lot of research in each of these markets - or looking too carefully at them.
Now, I've stated earlier in this thread that my experience so far is that one cannot be religiously married to entry and exit dates based solely upon historical seasonality - in addition to the need for position sizing, stops, and looking at the charts before entry to avoid buying tops. Plus profit targets and trying to figure out that a move ends "prematurely". So basicly, it starts to resemble discretionary trading - not solely trading on statistics.
NEARBY CONTRACTS AND BROKER FRAUD
There is a lot of Broker fraud in the Chicago and NY Pits. I do not know much of such fraud in Globex and eCBOT. Since such fraud is in Forex, we cannot rule it out yet in electronic spread trading.
Now regarding trading close to the contract expiration day in the Pits, you are unlikely to be filled with a limit order. You are now at the mercy of the market and the Brokers. They will make you pay heavily. And if you give a market order, they will kill you. A while back, I lost about $100,000 in Cotton Spread order in just 1 week because of this type of fraud. Yes, my $100,000 profit was wiped out in just 1 week. The brokers played every game possible to not fill my orders in a fast declining market. My loss was someone else's gain. That someone was either the Broker or an affiliate of the Broker. Owing to this experience, I close all my trades 1 week before expiration. There are too many markets to trade for me to stress myself because of a few more dollars in an expiring trade. Once electronic trading is fully established, these types of open fraud will be reduced, if not eliminated completely.
On Globex and eCBOT it cannot really be referred to as fraud, I'd rather call it games. As long as you have the money to back up an electronic order it should be possible to enter it.
Sorry to hear about that Cotton trade - I think I understand what you're talking about.
