Whoever is trying to convince people that buying the bid and selling the offer is a profitable startegy is an idiot who has never traded anything except garage sales.
I think youngtrader is legit. He is in Chicago trading directly on the exchange. (or working with traders from the exchange.)
Man, you auto-ridiculed yourself with this sentence. At least when you try to talk loud, try to know the guys you 're talking too. If you trade at a bucket shop, it's neither YoungTrader nor BondTrader's problem, but yours.
Commission get subtracted from winning trades and added to losing trades. It may be counter-intuitive to some people but in in case of scalping minimizing the impact of commissions to the ratio of avg. win to avg. loss and thus making money with a given success rate of a strategy is equivalent to maximizing the avg. loss. This is a problem of course because it is hard to find strategies with a high enough success rate to satisfy this constraint. This is proven mathematically in the book Profitability and Systematic Trading, pp. 53 - 56, and an example of how this result applies scalping is given in pages 59 - 60. Maybe you can access these pages using the Amazon "look inside" feature or find an online version of the book. It boils down to the mathematical fact that scalping startegies must have a very high success rate to make money, may 80% or more. I haven't been able to find one that is that profitable but I will keep looking forever...I promise...
If youngTrader, BondTrader and you are floor traders or market makers I agree you can do it and I said that already. Traders like me must use a broker unfortunatelly that is. Now, did I hear correctly that you called IB a bucket shop? If so, can you recommend a better broker?
Lol...he has friends who are willing to pass the spread to him... Maybe he is a floor broker, he pays no commission, just a small fee or something, he matches buyers and sellers and he makes the spread. I wonder though why does he things this is scalping? hmmm... Poor kids...
No, I am an IB client as well it's not a bucket shop. As you stated, we are market makers and locals.
7 pages later, my original assumption has been confirmed... that is most people are just throwing around the term 'scalping' loosely. notice the word 'most', that means I am not necessarily referring to you, but chances are that you are one of them in these 7 pages, there are some valid nuggets around 'feeling' the market on where it may go next, but that still doesn't provide an argument when the same 'feel' should not be applied to a 5 min chart, hence holding a position for 30min (which happens to be my preference), vs so-called scalp, where you give a chunk of profit to the spread. anyway, I am sort of enlightened, in the sense that I know what ETers are talking about (or not talking about for that matter)... so I am thankful for every input