After talking to several professional scalpers, I realised that the retail scalpers are in a serious disadvantageous position compared to the professionals.
My reasons are as follows:
1) In scalping, time makes the difference a winning trade and a losing one. The professionals use platforms like Trading Technologies' MD Trader which buy/sell, place profit/stop using one click of the mouse. (http://www.tradingtechnologies.com/flash/tour/prop/mdtrader.html)
In addition, the execution speed is further enhanced due to the fact that the platform has direct lease-lines to the exchanges compared to the conventional internet-based connection which retailer platforms utilise.
2) The professionals also have alot lower costs (in terms of brokerage) as they are usually members of the exchanges they trade in. To highlight the dramatic difference, their breakeven could be only 0.1 tick compared to retailers' 1 tick.
To me, certainly the playing field doesn't look all that level to me :)
Subscribe to:
Post Comments (Atom)
2 comments:
u got that right, but again, if a trader using TT in s'pore scalping say the Bonds would still lose out to the trader using the same system but trading directly in the Board of Trade building in Chicago.By just that split second , makes a world of difference in scalping.
Couldn't agree more, dude.
The milli-seconds lag (even with a lease-line) might juz make or break a trade.
Thanks for visiting my blog. Hope to see you around more often :)
Post a Comment