Scalping

Aspire

its capitalism and not socialism first, and second --- get yourself a level two that you can watch, and pay attention to when there is a bid and ask at the same price and the volume offered is (1) or (2)

this started with stocks, of course, and is a way of the mms saying "drop the price -- i NEED shares !"

i SWEAR on my mothers grave, and you can google and find much reference to this out there --- i just know about it because of my heavy stock background and constant use of level 2

when do i get the button (after you give me rep points i imagine) that says "this mans speaks with straight tongue ?"

cmon guys, i want to get to legendary --- keep those rep points flowing !!

enjoy and trade well

mp
 
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mp6140 said:
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since the name of the game is profit, it could be twenty businesses for all they care --- they have to MAKE MONEY, and they will use EVERY single opportunity presented to them.

this is CAPITALISM my friends --- there is NO concern for anything but the profit !


mp
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Yes but my point was that they would be MORE PROFITABLE by paying a low salary to someone to execute the necessary hedges. Then any traders they have who are good enough to make money from the markets (Who obviously would want to take home a good deal more cash than the execution trader) can concentrate on doing what they do best.


My point was also that these are two completely different businesses. The only thing they have in common is that they both require access to the same markets. So surely it's MORE PROFITABLE to concentrate on one at a time
 
Aspire said:
Yes but my point was that they would be MORE PROFITABLE by paying a low salary to someone to execute the necessary hedges. Then any traders they have who are good enough to make money from the markets (Who obviously would want to take home a good deal more cash than the execution trader) can concentrate on doing what they do best.


My point was also that these are two completely different businesses. The only thing they have in common is that they both require access to the same markets. So surely it's MORE PROFITABLE to concentrate on one at a time
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first off, what hedges are we speaking about ? While there certainly are hedges (i use them constantly, mostly to balance margin requirements and add a little profit to the company, but they arent "standard issue" at institutions normally !

everything is happening at once at a trading desk --- i personally trade 3 to 4 timeframes in a day, with many trades not coming home to roost until the following day, and while i could hire someone to do the "simple" junk i guess, if one has 10 people trading, and 10 people are using 10 workstations and theres no more room for another, its probably best to have 10 people who make you a LOT of money, than 9 people who make a lot and one who is a nebbish !

ITS PROFIT and you have to put your complete mindset into PROFIT

HEY LOOK --- hurricane hits Haiti --- FORGET the troops and supplies -- the victims and their problems, just make your money on what company is going to supply drinking water, or bandages, or doctors or whatever --- SCREW the victims and bet on THE CAPITALISM SIDE !

THEY DONT THINK LIKE PEOPLE !!!! THEY THINK LIKE RAPTORS !!!!

mp
 
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But making money out of the markets is not easy and poeple who aren't good enough lose it. If I was concentrating on taking money out of the markets and some pr1ck told me to stop doing what I'm doing to hedge your spread bet I would tell him where to go. No good trader is going to be prepared to work in that environment and they will only make money prop trading if they have good traders.

Equally well any monkey can click on the buy button to hedge a spread bet company's exposure and so it makes sense to use people who will require less pay to do this. Any SB company will get enough orders in that this can be a full time job for at least one person.


I think we may have to agree to disagree on this one
 
Aspire said:
But making money out of the markets is not easy and poeple who aren't good enough lose it.

as far as your words go, i would agree with that --- EXPERIENCE, even more than GOOD, is the keynote to keeping whatever you make --- gamma has just opened a thread that will take a newb, teach that person correct money management, and set them loose -- he postulates the person should be able to make 10% a month profits, and i would tend to agree with the statement

If I was concentrating on taking money out of the markets and some pr1ck told me to stop doing what I'm doing to hedge your spread bet I would tell him where to go.

Depending completely on the situation, the person might be right or might be wrong --- its a vague hypothetical and doesnt really point to anything one can discuss !

No good trader is going to be prepared to work in that environment and they will only make money prop trading if they have good traders.

I have taught prop traders and I know a few who throw in hedges at times, although thats not normally the way a prop shop works --- its mindset is usually much different, but if at the EOD there is profit from a trader, that trader remains to fight another day !

Equally well any monkey can click on the buy button to hedge a spread bet company's exposure and so it makes sense to use people who will require less pay to do this. Any SB company will get enough orders in that this can be a full time job for at least one person.

What i seem to have missed along the way is WHY is the sb entering ANY hedge ???
Its not normal business methodology !

I think we may have to agree to disagree on this one

first i think we need to know what terms of activity were actually talking about --- ive laid out how EVERY institution makes money, and while "hedging" can be a part of it when one speaks of nuts and bolts of the trading methods, its rare one gets that except in the field of "hedge" funds, IF THEY ARE STICKING TO THE ORIGINAL INTENT OF THE FUND, and not trying to become Morgan Stanlyey !
I run a nicely functioning hedge fund in ny state and would be very interested in seeing what im doing wrong !

as i stated, i have missed WHY you speak of hedging so much ----- please explain what you mean as the markets will be opening soon, and i may drift away for a time !
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mp
 
mp6140 said:
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of course, the SB might make a nice mistake and allow you to do it once, but dont look for a second time.

they dont like it for one simple reason --- youre eating their lunch because they make their money through the spread, and you better not mess with how they make money !

mp
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mp....A few days ago you admitted that you did not know what a spreadbetting company was. Why do you now feel qualified to offer advice on their business models? I do not recognise any truth in what you have said about them over all your many posts today, you seem to be referring to broker/mm practices which are nothing whatsoever to do with the thread-starter's question about spreadbetting.
 
peto said:
mp....A few days ago you admitted that you did not know what a spreadbetting company was. Why do you now feel qualified to offer advice on their business models? I do not recognise any truth in what you have said about them over all your many posts today, you seem to be referring to broker/mm practices which are nothing whatsoever to do with the thread-starter's question about spreadbetting.
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excellent question peto

like most things in this world, EDUCATION becomes important when one does not know.

finding myself in a UK oriented site, and liking it, i figured i better learn some slang, some ideas and how you trade, and while we use differing words for things, HOW THE WORLD BETS ON THINGS is pretty universal !

I have used two russian spreadbetters, one for 2 years and presently one for just a month, if that much, and while originally i simply referred to them as "brokers" out of ignorance, pretty soon i realized i was using spread betters also.

Now ive got a heck of a lot of time in the markets (over 30 years trading for myself) and while i certainly dont know EVERYTHING, i do know an awful lot, which is why i teach REALITIES of trading on this site, and not methods ! Realities encompasses knowing times of the day the market reverses, how many days to hold a stock or currency, what time of day is the best for trading, how the market functions, without the BS of "supply and demand" (and my friend, its more BS than you can accumulate in a day)

but getting back --- i was not even aware, because to me it was a "broker" that i was using, that there was something you call a "spread better" (guess you gotta cross the atlantic to cozy up to that term) and once i found out (those weeks ago you refer to, NOT DAYS) it was then simple to use the other words you use, knowing how they worked.

you can certainly disagree with me --- nothing short of a well placed mortar round would probably change your mind (and that simply ELIMINATES your mind without changing it) but THERE IS ONLY ONE WAY TO MAKE MONEY IN THE FINANCIAL MARKETS, and the institutions in Peru, Argentina, China, Angola, Arab Emerites, UK, USA, and every place else do it that way because thats the way its done !

they do NOT trade the way we do as retail traders have a singleness of purpose, while institutions are working a much bigger picture ---- with a lot more experience, you should be able to understand how and why the markets move up and down the way they do, or do you think its simply because they like waves ?

Ive said what im going to say --- i have the obvious experience and credits to back it up, I have had agreement from more than a few of the more experienced traders on this site and personally, its really a topic of small interest to me, but being bored while waiting for the market to open, i thought i might help a chap --- obviously more arguement than help is wanted, so i drop it now !

continue on with your own thoughts --- whatever they may be !

enjoy and trade well

mp
 
Hi

It really doesnt matter for them if you do scalping or not, they get their spread anyway, the problem could be yours because most of the times you could be paying more for the spread than what youre making.
Any way it really works for almost everyone.
Go ahead

x75 said:
I have seen repeated, many times, the accepted wisdom that SB Co's "don't like" scalping.
Is there a specific reason for this, ie inconvenience value, or is it because it actually works?
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MP -- goodnite mrs callabash, wherever you may be !

fayalac said:
It really doesnt matter for them if you do scalping or not, they get their spread anyway, the problem could be yours because most of the times you could be paying more for the spread than what youre making.
Any way it really works for almost everyone.
Go ahead
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===================================================================

while the whole idea behind "reputation" points and "length of service and experience" titles for each poster is readily apparent (ie: those with MORE experience teach those with less !) one runs into these problems at times --- there will always be the 16 year old son who knows SO MUCH MORE than his father !

here in the US, there are even printed rules prohibiting what you mistakenly call scalping from happening, complete with the penalties for doing so --- the brokers, mms and sb's aint AGAINST these short term trades unless it means they lose money --- i have a ferrett that knows that for G-D's sake !

have fun with your ideas, as off the wall as they may be. I wanted to help and have a break today, but youse guys are just something else ---- rookies arguing with those with experience will not get you far in this world, but continue on and find out for yourself !

mp
 
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Well mp, as you say you may know a lot about trading but you don't know much about spread betting. I have been doing that stuff for years so I know what I am talking about.

To answer the question. Spread Bet companies like World Spreads have a problem with scalpers because they offer 1 pip spreads on major currency pairs and it is a dishonest model which depends on clients losing if they are to stay in business. Capital Spreads have aweful fills for everyone so you can't trade for a few quick pip gains with them as a regular scalper.

CMC requote a lot so if you are a scalper it will be folly to try to do it with them.

Notice that the problems I talked about have to do with the problems with SB companies in general rather than as it applies to scalping, but scalpers notice it more simply because it affects them much more.

Now if you can find a SB firm which does not have any of those problems and you are a consistent winner, they would obviously want to hedge your bets and you would not allow them to do that if you are in and out in seconds. So they would have to refer you trades to dealers.

That is basically the story.
 
FXSCALPER2 said:
Well mp, as you say you may know a lot about trading but you don't know much about spread betting. I have been doing that stuff for years so I know what I am talking about.

To answer the question. Spread Bet companies like World Spreads have a problem with scalpers because they offer 1 pip spreads on major currency pairs and it is a dishonest model which depends on clients losing if they are to stay in business. Capital Spreads have aweful fills for everyone so you can't trade for a few quick pip gains with them as a regular scalper.

CMC requote a lot so if you are a scalper it will be folly to try to do it with them.

Notice that the problems I talked about have to do with the problems with SB companies in general rather than as it applies to scalping, but scalpers notice it more simply because it affects them much more.

Now if you can find a SB firm which does not have any of those problems and you are a consistent winner, they would obviously want to hedge your bets and you would not allow them to do that if you are in and out in seconds. So they would have to refer you trades to dealers.

That is basically the story.
Click to expand...

Using a calendar to time the journey of a ship sailing from UK to Australia is OK. But if you want to measure the time it takes a jet airplane to fly from UK to France you need faster data, so a clock or watch is needed. I think the main problem with SB is data provision. This is one of the reasons why SB is non-professional!
 
FXSCALPER2 said:
Well mp, as you say you may know a lot about trading but you don't know much about spread betting. I have been doing that stuff for years so I know what I am talking about.

To answer the question. Spread Bet companies like World Spreads have a problem with scalpers because they offer 1 pip spreads on major currency pairs and it is a dishonest model which depends on clients losing if they are to stay in business. Capital Spreads have aweful fills for everyone so you can't trade for a few quick pip gains with them as a regular scalper.

CMC requote a lot so if you are a scalper it will be folly to try to do it with them.

Notice that the problems I talked about have to do with the problems with SB companies in general rather than as it applies to scalping, but scalpers notice it more simply because it affects them much more.

Now if you can find a SB firm which does not have any of those problems and you are a consistent winner, they would obviously want to hedge your bets and you would not allow them to do that if you are in and out in seconds. So they would have to refer you trades to dealers.

That is basically the story.
Click to expand...
=================================================================

as far as i can see, whatever "story" people think is concluded is simply yet another regurg of what came before --- indeed my russian spreadbetter offered one pip spreads, which was the reason for using them for years.

over a period of time, i both flipped and traded longer term, although their TRICK was to DELAY your entries and exits, so they could raise or lower the market price, if they were done manually ----- and every now and again, even if i had a limit order filled, it would be filled below my limit price, but then try communicating with a russian spread better when they dont want to talk to you !

BUT fxscalper, you havent answered the question, only stated that sb's are dishonest, which i knew long ago, as are most of the "brokers" here in the states !

the QUESTION is WHY ---- the ANSWER, as it ALWAYS is, is because of PROFIT ---

and im beginning to get a tad upset by people telling me i dont know anything about spread betters, when ive used one for two years and another for a lesser time and grown my accounts sizeably with them --- and maybe, JUST MAYBE, its because i dont give them a sl to grab overnite !

enjoy and trade well

mp
 
Interesting thread, how do you define scalping, for me I look upon scalping as a method to grab 5 points or less in the shortest possible time allowed, it is possible and I do employ a scalping technique when I'm struggling to get my daily points limit. I S/B and have never had any problems with the companies I trade through, with the right set up, you could "scalp" your way through the day collecting 5 points a trade without any real stress, exposure is limited by the nature of the quickness of the trade, trade only in the direction of the trend, unless its just me, I find scalping very easy and profitable.
 
Dinos said:
Interesting thread, how do you define scalping, for me I look upon scalping as a method to grab 5 points or less in the shortest possible time allowed, it is possible and I do employ a scalping technique when I'm struggling to get my daily points limit. I S/B and have never had any problems with the companies I trade through, with the right set up, you could "scalp" your way through the day collecting 5 points a trade without any real stress, exposure is limited by the nature of the quickness of the trade, trade only in the direction of the trend, unless its just me, I find scalping very easy and profitable.
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i started with this, as an awful lot of my posts are, as a joke talking about the word "scalp", as it was our word first !

made famous by the SOES bandits, it was an extremely short term trade where the scalper bought and sold a nyse stock WITHIN the spread, thus undercutting the specialist.

in 2000 (approximate) the SEC went over to decimal trading (it had been in 1/16ths before) effectively eliminating the ability to scalp !

you dont find the word used much in the USA anymore, simply because its real definition no longer exists, but we here use the word "flipping", as in "I flipped that pair for 3 pips" while you use "scalp".

jokingly i gave this historic "treatise" as a late nite stand up routine, and the rest is history

its a process, among most OTHER processes that i use daily and i would be the last one to state its no good !

boy, do things grow out of proportion !

mp
 
mp6140 said:
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----- and every now and again, even if i had a limit order filled, it would be filled below my limit price, but then try communicating with a russian spread better when they dont want to talk to you !

enjoy and trade well

mp
Click to expand...

A buy limit order can be filled below the limit price, that's what a limit order is isn't it? How can you scalp with limit orders?
 
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