Scalp Trading or scalping is a form of trading strategy used by traders and spread betters looking to profit over a very short time-frame.
While day trading looks to profit over the course of a day or during the day, scalp trading or scalping involves opening and closing a position for a maximum of few minutes – often closing within seconds.
It is a very intense form of trading, only really suited to those who are doing it full-time as you have to remain incredibly alert. The logic is to repeatedly open and close positions (long and short) and then close your position as soon as the market moves against you – and the whole process repeats over.
Scalping is a classic case of little and often – taking little profits often on a share or index that you may be trading on.
Due to the nature of this type of trading, shares which are very liquid are best suited to it, ones such as the FTSE 100 that are very regularly bought and sold throughout the day.