Why some brokers don't allow scalping?

[Andy]

Follow the post of s@ndr@ How to choose a Forex broker? - Page 2

There have one interesting topic that worth for the discussion: why some brokers don't allow scalping?

Scalping is a well-known trading strategy and tend to make profit for some traders. For definition what is scalping? Brokers that allow scalping check out Brokers for scalping | Forex brokers that allow scalping

But, there still have many brokers that don't allow scalping and restrict traders from using this trading method!

Why? What is your ideal?

 

[budado]

Its more on traffic. If you notice if the volume of trade happen theirs always a slow down and sometimes you can see server busy or connection error when you trade. Its because the volume of activity is too much for a server to handle. And that's why they don't allow scalping or trade that is less than two minutes.

 

[riddick09]

Hmm, seems that's probably one of the reason. Because I did experience sometimes in trading and looks like server overload or they can't handle our requests. That's why I see those connection time out or can't connect in my terminal but my internet connection works perfectly.

 

[ProTrader]

Scalping is dangerous but once you matter it, you can make quite profit. Your profit = Broker Loss. They want you hold the position still you loss or give they enough time to make some change on your platform. At least it may the case for few market maker brokers!

 

[s@ndr@]

I think budado's explanation makes sense. probably the brokers which do not allow this strategy are those who dont have the proper technology and systems in place to support high volumes. ProTrader i think also has a point when we talk about market maker brokers. so basically these brokers will also not allow u to use any EA that is based on scalping either...

 

[anuj7]

The phrase scalping mainly is the phrase for latency trading, where customers wrongly manipulate, to their benefits, setbacks that may happen due to the fact that forex trade is Internet-based.

 

[zebrut]

or me its still a newbie to use scalping is risky at all, especially when we only use a small capital, it can be ascertained will quickly suffer losses due to lack of understanding and enough flying hours so do not understand what should be done, but for a newbie it better to use SL because with the SL we can minimize the losses that we get.

 

[nikotien]

using scalping strategies are not allowed by the broker for this strategy are able to make quick and big profits. broker may be a loss.

 

[zebrut]

there are some brokers who may not use scalping strategies but for my own scalping strategy is a strategy that is very dangerous because the capital I use very little so it will not reach the desired profit. therefore capital since I use is very small so I can only apply the strategy SL / TP to prevent large losses. but although I only used the strategy SL / TP is still a profit although not too large.

 

[rexway]

Well as for me i think scalping is dangerious sometime for me what I really do is hedging even if am not that good with it but I always make sure that i do my best just to maintain my good trading work with long term trading and not scalping thou my broker accept it

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Well as for me i think scalping is dangerious sometime for me what I really do is hedging even if am not that good with it but I always make sure that i do my best just to maintain my good trading work with long term trading and not scalping thou my broker accept it

 

[zebrut]

but for a beginner to use hedging strategies are very dangerous because they do not understand how the actual price action moves so they are still at a loss when faced with a situation of price movements is whether to cover losses or gains to close in trading making dilemma especially if you have to use a long-term trading strategies really very risky

 

[rexway]

I dont think that for a beginner to use hedging that its that much good what I know is that hedging can only be use by people who know how to trade with such strategy and in as much as I know there is nothing good that can come out from hedging if you dont know how to use it but rather the best thing is just to trade long term which I think is the best.

 

[riddick09]

Why, is there a trader that knows hedging even not have trading experience yet? Anyways, hedging is simply risky if not good with timing and little knowledge on the pair you are trading, scalping can have less risk and I suggest to have it and we are fortunate that most of the popular brokers we know are allowing scalping.

 

[zebrut]

What kind of price action we have to do if you use scalping strategy if if action stabilized the currency pair movement we can use scalping strategies because now I often fail when using SL strategy when I follow the price movement for open position when the action is the price was moving rapidly and reaches its lowest or the highest but using SL strategy now useless

 

[budado]

Why, is there a trader that knows hedging even not have trading experience yet? Anyways, hedging is simply risky if not good with timing and little knowledge on the pair you are trading, scalping can have less risk and I suggest to have it and we are fortunate that most of the popular brokers we know are allowing scalping.

In my experience a broker site that has mt4 has a higher chance that they will going to allow hedging. As I have joined a site before that they offer to platform. The mt4 platform allowed hedging while the other platform don't. No about scalping. The main reason why many broker sites does not allow scalping is because of traffic. Just imagine that you are opening and closing position in short time. The traffic will going to increase if a lot of members will do scalping and that will going to slow down the service.

 

[naninov]

well... broker needs time to move money when it is traded, especially if the trader is trading a mini account which uses non-standard size lot. scalpers usually trade with big lots in a short time, so... for example if a trader buy 1 lot then the market moving 3 pips within 1 minute and than the trader closes the trade for profit, the broker can be caught with the money stuck in his system causing them to lose profit

 

[zebrut]

In my experience a broker site that has mt4 has a higher chance that they will going to allow hedging. As I have joined a site before that they offer to platform. The mt4 platform allowed hedging while the other platform don't. No about scalping. The main reason why many broker sites does not allow scalping is because of traffic. Just imagine that you are opening and closing position in short time. The traffic will going to increase if a lot of members will do scalping and that will going to slow down the service.

may be right in what you say but I think it depends on the brokers themselves whether they allow us to use scalping strategy because most of the brokers still allow us to do scalping strategy for the broker itself, which does not allow to use scalping strategy is only possible due to earn big profits and short so that they feel very lost when allowing scalping strategy performed in the broker

 

[indieover]

I am not familiar with the broker that don't allow scalping as the ones as I am into allows scalping .maybe the reason is that the traders who do scalping may earn a lot more than those don't do scalping and so it may cause brokers to pay more.

 

[zebrut]

indeed with the scalping strategy allows us to quickly get a good result but most of the brokers are not willing to provide for adverse broker scalping strategies, but even though we use scalping strategies we must also fully understand the price movements that happen so we do not get stuck when opening a position

 

[adam fx]

For scalping you have to examine and test lots of brokers. I use Armada Markets, you can start the research with that.