TastyLive: Scalping Was Hard, Until I Found These Videos

The increase in daily options trading can make or break a portfolio account. While some traders still swing for the fences, others tend to look at scalp trades. Those are simply trades designed to get in and out, collecting a small profit, potentially within a matter of minutes.

That strategy can ensure a quick profit. And that a trade doesn’t start to lose value. Understanding how to scalp trade can help traders and investors alike earn better daily returns.

First, it’s important to use a liquid investment. Scalp trades work best with highly liquid positions, such as index ETFs for the S&P 500 or Nasdaq.

Some individual stocks may work, but only the largest will be the most liquid. Liquidity ensures that trades can be entered and exited quickly.

It’s also important to measure an opportunity. Some assets will move more than others. Tech stocks may fluctuate between 1-3 percent daily, and some commodities such as oil. A market index will likely be smaller.

Smaller moves can mean smaller profits. But catching a move in an opportunity can still mean making a sizeable profit quickly.

Finally, it’s critical to have a strategy that’s consistent and repeatable. That way, opportunities can be acted upon, and traders can know when to take quick profits and move on to the next opportunity.

To review the best strategies for scalping trades, click here.