CME floor products (pit) are now available through IB

Who really wants access to Lean Hogs?

This bit from “def,” a representative of Interactive Brokers, made me smile:

There is a risk disclosure when you sign up for the US floor access that is, if anything, an understatement of the issues you may experience. For instance, you can fully expect to only get a fill on a floor contract when the electronic version is already priced to make an easy arbitrage against your order for the local on the floor. Trade reports can easily be 30 seconds and 2 minutes will be not uncommon.

The above is not meant to discourage use of the floor for products whose primary liquidity is on the floor. But we do want traders to recognize the realities of the floor, namely the order is being managed by people who will make errors, be slow, or have a conflict of interest (dual trading, for example). Additionally, there is a significant inherent latency in the execution/reporting process. IB will get your order to the floor in a few seconds. After that, we lose a significant amount of control because the orders will be in a non-digital environment. One of the main reasons IB has avoided pit access is that the trading environment on the floor effectively undoes all the work we have invested in high speed order routing, SMART technology, etc.

– Thanks to Robert for pointing this thread out to me —