Quote from kitty1996:
Hello to you all:
I am just wondering why trading communities/traders have the lowest respect for scalpers?
This is evident in ET forum & other trading forum, like Yahoo.
Can someone please tell me why?
Is it because scalpers don't study much about fundamentals/technicals? Or because they make the lowest income compared to other traders?
What is it? What is the real reason?
I only learn scalping-method recently. I don't know much about this scalping trading business. And so far, I only read BAD THINGS about it, especially in this forum.
Thank you in advance for all opinions and best wishes to all of you.
from personal experience, scalping is the thing i learned on day 1.
as excited as i was generating consistant profits with extreme accuracy, they blow up?
as the cliche goes in trading, its not about the profits, but its about your downside controls.
scalping involves, cutting your upward potential, to maximize certainty of profit, however this goes against the old saying "never cut your profits". the reason being is that, over the long run, you will mount to losses depending on how tight your stops are. usually scalping invovles risk;reward ratio of at least 2:1, this is to once again apply the notion of maximizing certainty of profit over the downside risks.
so using tighter stops willl result in lower rate of profits.
using larger stops will result in higher rate of profits but an increased risk exposure.
where's the logic behind this? you are cutting out your profits, and to be continually generating income, you have to take more risks than your reward.
because the market is subject to random events, over the long run, you will absolutely guaranteed force to get margin calls.
i believe through my own experience and realization, what the older traders are saying is true.
trading is all about your downside exposure and how much you can control it.
my two cents.
