Scalping

A description of horizon rather than of method. Positions are opened and closed within minutes, sometimes within seconds, the target is a small number of pips or ticks, and the count of positions in a day is high. The same entry logic used over weeks would not be called scalping, so the word says how long a position is held and nothing at all about how the decision to hold it was reached.

The arithmetic is what separates the style from every other. Cost per position barely changes with the size of the target, so as the target shrinks the cost becomes a larger fraction of it. Three charges apply: the spread paid on entry and exit, any commission, and the difference between the expected and the actual fill. At a horizon of seconds the last of those is not a rounding error, because a price can change in the interval between an instruction being sent and being executed.

Two things are consistently underestimated. Execution quality, not prediction, sets the result at this horizon, which is why scalping is discussed alongside routing, latency and the pricing model of the account rather than alongside chart reading. And some firms place conditions on very short holding times or on strategies that depend on stale quotes, so the account terms are part of the description. Whether the style survives its own cost base at retail scale is genuinely disputed, and the dispute is about costs rather than about signals.