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I have been unable to determine which of the following is better, for defense of transporting troops, in this game:

1) transport ship by itself
2) transport in same sea zone as escort fleet
3) transport in escort fleet

Has anyone been able to determine this? I'm not asking what makes sense, but what works for protecting transports. (In short, in this game, is it advantageous to make sure that transports are in an escort fleet?)

That is a great question.  Obviously, we would all think it would be #3, but you never know how things work in the 'mysterious' naval part of this game. 

For 99% there shouldn't be difference between 2 and 3.
 

But surely, if the transports sail in a group of their own, they also have to fight alone if intercepted! Or ...? [&:]
 
I take it that gwgardner refers to 2 different groups in the same zone, 1 transport and 1 task force?

ORIGINAL: Uxbridge

But surely, if the transports sail in a group of their own, they also have to fight alone if intercepted! Or ...? [&:]

I take it that gwgardner refers to 2 different groups in the same zone, 1 transport and 1 task force?

Exactly. For instance, I want to transfer a division from Plymouth to Alexandria. I already have a task force in the South Atlantic. Does that single transport need to be made a part of that naval task force, or merely be in the same sea zone? If I understand doomtrader correctly, it's the same either way - in or out of the naval task force.

Now normally, I would go ahead and place that transport in an escort fleet. HOWEVER, in that case, does the game system make it more probable that the transport is engaged in a naval battle, because it was easier to find the whole task force? And is the transport the first target, in a task force with escorts?

So many questions.

perhaps I am doing things wrong, but when I put a unit into transports and move it into a sea area, it then has the (M) beside it and I can no longer transfer it into a fleet that already exists.
 
What I have been doing is planning a turn ahead, moving an escort fleet into the port, then it comes out in the sams fleet with some ships.  I had been assuming if I put the transport to see in a fleet by itself there would be a much better chance of it being found.
 
From my limited experience it seems that with regular (not raider) type fleets that there is a chance opposing fleets will find each other, and once that happens each fleet then commits a certain amount of their assets to a fight (but at least one?).  So I find rarely does my whole fleet fight, but usually a significant portion of it.  So I worried if I send a transport with a inf division to see in a fleet with only the transport of the fleet is found the transport is found. 
 
I am aware I could be 100% wrong on how this works.  It could be (and it seems to be from what Doomtrader said) that fleets don't really matter.. they might just be a nice convenient organizational thing for us and no more.  perhaps its just in each sea zone each unit checks to see if it sees other units (detects them) and all the detected units on each side fight or something like that.  Uhhmm I really should read the manual closer I suppose.