Can scalping make you rich?

Recently there is a post on position trading by Ingot54. He describes that he had success with position/swing trading but was not very well with intraday or scalping. Although he acknowledged that there are successful scalpers, he went on to quote from some people that short-term trading is not as profitable as long-term trading.

I have ploughed through the forum and I found there are people trading intraday successfully, like Mr Chart (see his method). However, I am more interested in the profitability of the two kinds of trading. I would like to ask experienced traders of both styles:

1. Do you think, in the long run, swing/position trading makes more money than intraday trading (including scalping)?
2. Do you think the pipwise difference in target profits in the two kinds of trading can be compensated with higher leverage, without risk more volatility?
3. Suppose you trade both styles, and you are trading fulltime, which style makes you more profit? Or if you were to quit your job and trade professtionally, which style would you prefer?
4. Finally, a question for the full-time scalpers: what makes you choose scalping over position/swing?

It is quite a long list of questions, and it certainly rivals a boring job interview, I confess. However, I am sincerely interested in this topic, since I myself is trying to choose between the two as well. I appreciate your time in advance.

swing position takes LOoooooooooooNG TIME to get into.. thats why while traders are waiting, there are traders temporary scalping.

Another one of those sprint versus marathon running discussion. So boring.

Different people are built differently! Some are good at 100 meter sprint. Some are good at 26 mile marathon. Some can do both. Some can't do either!

Try them both. Try them all! See what fits you. If you can do both, that's great!

Bolimomo said:

Different people are built differently! Some are good at 100 meter sprint. Some are good at 26 mile marathon. Some can do both. Some can't do either!

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Well, if you read my starting post carefully, you shall discover that I never wanted to start a debate which one is good or bad, I'm merely trying to ask about the difference of the two styles, given their different average true range, duration, volatility and leverage involved.

Perhaps it was my fault that I did not write it carefully in my first post, so it led to some misunderstanding. Please allow me to clarify.

I think I should have renamed the title as, "Can scalping make you rich AS MUCH AS POSITION TRADING". As I stated, there are people making money in the intraday way of trading, like Mr Chart in this forum (see first post). What I want to know is, given the inherent advantage for larger target profit in swing/position trading, can intraday traders compensate for this with larger leverage? If so, do they risk more due to high involatility in short time frames?

So put it in another way, the question of whether scalping give an annual return on the par of (or even better than) swing or position trading is what really interested me. I shall reiterate than I know some people can only do one of them, so for them this question is meaningless. But suppose you can do both and your personality does not have any bias towards either, which would you prefer in terms of profitability, if you are only allowed to choose one?

hard to answer. there r ppl scalp can earn more than swing trader. as well as while there r also swing trader can earn more than scalp trader.

maybe.. there r also scalp trader earn less in year 08 than swing trader. while on year 09 scalper earn more than swing trader in year 09

there r also swing trader earn less in year 08 than scalp trader. while on year 09 swing trader earn more than scalp trader in year 09 & so forth.. lulz :whistling

Both scalping and position/ swing trading can make you far more money than you will ever be able to spend. The money is not and should not be a consideration when finding your style.

Aspire said:

The money is not and should not be a consideration when finding your style.

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Why not ?

It's all about money and risk isn't it ?

dcraig1 said:

Why not ?

It's all about money and risk isn't it ?

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Well, for starters, like I said, you can make far more money either way than you will ever be able to spend so for someone starting out to be worrying that they won't he able to make enough with one style is a bit silly.

Are you fast thinking, aggressive, competitive, calm and enjoy computer games? Then maybe you should be scalping.

Are you more patient, planned, stick to your convictions, like to have time to think things through etc? Then maybe you are better suited to position trading.

Some people who would make good swing traders could never scalp. some people who could scalp really well could never swing or position trade.

You don't have to decide which approach is best. They're both more than good enough when done well. You have to decide which is best for you.

Scalping can make you rich, it can make you richer than that... but it can't make you the richest

GCC, I'll answer your questions when I've got some time, but I used to position and swing trade but found I could make more money intra-day trading.
"Scalping" is not really the right word, most of my short term trades last several minutes to a few hours, though occasionally I scalp trades in seconds - not recommended for the inexperienced.
Richard

trade both ways ....

Day-trading allows for impatience and lack of discipline and taking bad signals. People think because there is more opportunity there is more to be made from day-trading and this to a certain extent can be true. Personally what i've been starting to realise is the best way to trade is to find swing trading opportunities in forex, then enter them on a 5-minute chart; trying to get a 10-point stop loss with a 600 pip target.



-Taylor

Thank you for all your replies, I am sure many people will find them as helpful as I do.

Aspire said:

Well, for starters, like I said, you can make far more money either way than you will ever be able to spend so for someone starting out to be worrying that they won't he able to make enough with one style is a bit silly.

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I am currently having one account for intraday trading and another account for swing trading, both are live with REAL money. Although I am not trading as frequently as some other people do, I am doing pretty well in both. I agree that it will be silly thing to not consider personality to choose a kind of trading, and I don't believe you can only trade (or at least try) one of them. This is exactly why I am interested in finding people who also trade both of them (or at least having tried both), and their opinion on both styles. This is completely the opposite of trying to label one as good and the other as bad, as some repliers still wrongly believe.

arabianights said:

Scalping can make you rich, it can make you richer than that... but it can't make you the richest

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Care to elaborate further?

Mr. Charts said:

GCC, I'll answer your questions when I've got some time, but I used to position and swing trade but found I could make more money intra-day trading.

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Looking forward to your answers! Also interested in why you find intraday makes you more money.

Taylored001 said:

Day-trading allows for impatience and lack of discipline and taking bad signals. People think because there is more opportunity there is more to be made from day-trading and this to a certain extent can be true. Personally what i've been starting to realise is the best way to trade is to find swing trading opportunities in forex, then enter them on a 5-minute chart; trying to get a 10-point stop loss with a 600 pip target. -Taylor

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As I can see you are a position trader, although you utilize smaller time frame as well. Do you seriously mean you can find a trade with 10-pip SL and 600-pip TP? Please teach me how it can be done!

Really interesting to see that you have a different opinion from Mr. Chart. But of course this may be due to the fact that you two are talking about different markets (US Stocks for Mr. Chart, Forex for you).

Some scalpers work around the bid/offer, buying on the bid and selling on the offer to pocket the spread, or perhaps a tick or two more, this is what a pure scalper is. Am i called a scalper, my trades are generally taken from two different trading styles, I look for points based on volatility . My ratio to targets and stops are not what they tell you in all the books. However, I do move my stop closer to my entry, once the market have moved in my favour by some points, again, based on volatility on the market I am trading.

So to answer your question, scalping/daytrading one can make money, if one is discipline. Did you know, the most successful day traders, are the most active, something to pounder over.

GCC,
1. Do you think, in the long run, swing/position trading makes more money than intraday trading (including scalping)?
2. Do you think the pipwise difference in target profits in the two kinds of trading can be compensated with higher leverage, without risk more volatility?
3. Suppose you trade both styles, and you are trading fulltime, which style makes you more profit? Or if you were to quit your job and trade professtionally, which style would you prefer?
4. Finally, a question for the full-time scalpers: what makes you choose scalping over position/swing?
First some background: I swung and position traded for a few years in the 1990s whilst I was a full time dentist and my trading profits were consistent and reliable. I also traded futures and options.
I then started day trading US shares in the evenings and on my afternoon off. I found I made more profits and realized I could make more trading full time than being a dentist, and enjoy it a great deal more, so I sold my practice in 1999 and have day traded using several set ups and triggers ever since. One of those set ups is linked below my signature.
So yes, my personal experience is that day trading is far more remunerative and you sleep well at night because you carry no overnight risk. You are flat every night, every time you go on holiday, no worries, no stress.
As I said earlier, my trades aren’t classical scalps, they are short term high probability trades where several factors come together and make profits highly likely. On those trades which don’t work immediately I normally exit for a tiny loss and my use of level 2 T&S often gives me very sharp entries and exits. On those that fail, I usually can see the trade is not going to work very quickly and I see no point in sitting in a trade waiting for it to hit a stop loss. If it goes against me, I’m out.
With swing and position trades you are using your capital and so it is tied up in positions where all sorts of extraneous factors can hit you for serious losses overnight or when you’re not looking. Even with resting stops you can be filled well away from your stop loss price. I’m talking about stocks here.
With day trading you keep on using part of your capital time after time during the day; in other words you are maximizing your capital usage; you’re sweating it, rather than a swing trade sweating you. This produces rates of ROCE (return on capital employed) which make swing traders’ eyes pop.
Have a look at the following two images: the first is a daily chart of LRCX, the second a 5 min chart of today’s action so far.
I think you can see how many more opportunities there are intra day than on a daily chart in the example of LRCX.
Richard

Daily chart of LRCX of the last month

And a 5 min chart of today so far.

Three opportunities on just the one stock alone:
on the way up, on the way down, on the bounce.

Now compare with "opportunities" on the daily.......
Richard

why are you concerned with how much money different timeframes can make for other people?

no, can not... Otherwise it would be evidence of this. No such of people here on this board or anywhere else. It can bring you, if you extr. lucky, some pocket cash, 5-10 grands, once in a while... but no more...