Scalping — Trading Wiki

Publisher and editorial transparency

Published by TradeHQ. Site creator: Anuga Weerasinghe. This page has no recorded editorial review date; the About page explains the site's editorial approach.

What Scalping means

Scalping describes attempts to capture small price movements over short holding periods. Execution and costs can outweigh gross gains.

In depth

Scalping is a short-holding-period style aimed at small price movements, often over seconds or minutes. A description of the objective is not evidence that the movements can be captured profitably. Latency, queue position, partial fills, spreads and commissions can matter relative to a small target. More transactions multiply costs as well as opportunities; the number alone cannot establish positive expectancy. Not every account offers the same execution or fee terms. TradeHQ’s displayed-price market fills do not reproduce an exchange order book, maker rebates or high-frequency infrastructure, so tiny simulated gains cannot validate an executable scalping strategy.

Key points

• Captures tiny price movements over seconds to minutes
• Short-horizon price targets can be overwhelmed by spread, fees, slippage and slow execution
• Break-even win rate depends on realized win and loss amounts plus costs

Why it matters when you are learning

Compare a small hypothetical gross price change with spreads, fees and worse fills. Discipline alone cannot remove execution risk or establish an investment edge.

Worked exercise and its limits

Ten invented round trips each gain $2 before $3 of round-trip costs: total net loss is $10. Vary costs before calling tiny gross moves profitable. TradeHQ fills do not reproduce queue priority, latency or an exchange order book.