GlossaryIntermediate
Scalping
A trading style that targets many small, quick profits from small price moves, typically closing positions within minutes.
Scalping is a trading style that targets many small, quick profits from small price moves, with positions typically held for only minutes at a time, relying on a high volume of trades rather than a few large, patient positions.
Because each individual trade's profit target is small, scalping is especially sensitive to trading fees and slippage (see Kaavon's "Slippage" glossary definition) — costs that barely register on a large, patient trade can meaningfully erode or eliminate a scalper's thin per-trade margin.
Examples
- A scalper might open and close dozens of positions in a single day, each targeting only a small price move.
- Trading fees and slippage, which barely matter for a large patient trade, can meaningfully erode or eliminate a scalper's thin per-trade profit margin.