Yes, you can make money with stocks. Although scalping sacrifices the size of winning trades, it greatly increases the ratio between winning and losing trades. However, some traders prefer different strategies that allow them to make greater profits. One is the stress of sitting in front of the computer and watching price changes, and the second, the execution of trades.
Scalping or trading are typical activities where very few succeed, but which have the potential to be scalable if done successfully. Over time, slippage results in staggering amounts and is a major obstacle to overcome if you want to make profits through scalping. The dangerous thing when the risk-reward ratio is bad is that traders risk much more than the expected profit. However, there are many professional operators in companies and utility companies that use well-designed scalping strategies that can be repeated many times throughout the day and can be profitable.
If you still want to make small profits, make sure you have proven or quantified scalping strategies. But you need to define your scalping strategy very precisely to be able to test it with historical data. At Quantified Strategies we use Tradestation and Amibroker, two very good tools for trading, but not for scalping in the very short term. If you prefer currency scalping, you can choose a random direction and end up investing in larger trades.
We know a person who invested considerable amounts of money to create an infrastructure that would allow him to profit from short-term speculation in Eurex futures. If you're a scalper and you want to start a trade with a break of 100, you face the challenge of getting an offer when the market shows an offer of 100.02 and a bid of 100.05. Some companies define scalping when traders trade 25% from the actual average daily range; some traders define scalping when they get a pair of pips. Any retrospective test based on short-term data is unlikely to reflect reality when you start scalping with real money. Scalping is a waste of time because it involves competing with better-equipped operators and institutions and you have to deal with the large amount of randomness and noise that exists in the market.
