Scalper

AAA

DEFINITION of 'Scalper'

A person trading in the equities or options and futures market who holds a position for a very short period of time in an attempt to profit from the bid-ask spread.

A person who buys large quantities of in-demand items, such as new electronics or event tickets, at regular price, hoping that the items will sell out. The scalper will then resell the items at a higher price. Such transactions often occur on the black market. This type of scalping is illegal under certain conditions.

INVESTOPEDIA EXPLAINS 'Scalper'

The rapid trading that occurs in legitimate scalping usually results in small gains, but several small gains can add up to large returns at the end of the day. There is also an illegal type of scalping in investments in which an investment advisor purchases a security, recommends it as an investment, watches the price increase based on his recommendation, then sells the security for a profit.

RELATED TERMS
  1. Option

    A financial derivative that represents a contract sold by one ...
  2. Day Trader

    A investor who attempts to profit by making rapid trades intraday. ...
  3. Pump And Dump

    A scheme that attempts to boost the price of a stock through ...
  4. Futures

    A financial contract obligating the buyer to purchase an asset ...
  5. In And Out

    A trading strategy in which shares of a single security are bought ...
  6. Bid-Ask Spread

    The amount by which the ask price exceeds the bid. This is essentially ...
Related Articles
  1. Trading Strategies

    Scalping: Small Quick Profits Can Add Up

    We look at different styles of scalping, and how they can all be very profitable.
  2. Forex Education

    Market Makers Vs. Electronic Communications Networks

    Learn the pros and cons of trading forex through these two types of brokers.
  3. Options & Futures

    Trading Gold And Silver Futures Contracts

    If you are a hedger or a speculator, gold and silver futures contracts offer a world of profit-making opportunities.
  4. Trading Strategies

    Does Your Personality Match Your Trading Methods?

    Investing has ways to successfully accommodate a variety of personalities. Learn how to align your trading with your traits.
  5. Trading Strategies

    Introduction To Trading: Scalpers

    This type of trader makes many trades per day to "scalp" a small profit from each trade. Find out how it works.
  6. Active Trading

    Getting Through The Rough Patches In Trading

    Learn how to recognize and adapt to tough times in the markets.
  7. Forex Education

    Forex: How To Scalp Fundamentally

    Learn why event-driven scalping in the currency market involves balancing fundamentals with technicals.
  8. Options & Futures

    What is the difference between a short position and a short sale?

    Learn how short selling and short positioning are different, specifically in regards to the nature of the commodity being bought and sold.
  9. Options & Futures

    Are there any risks involved in trading put options through a traditional broker?

    Explore put option trading and different put option strategies. Learn the difference between traditional, online and direct option brokers.
  10. Options & Futures

    Options -- Accessing Stakes In Apple At Less Cost

    Finding Apple stock costly to trade? Here are multiple ways to trade it through low-cost Apple options.

You May Also Like

Hot Definitions
  1. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  2. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  3. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  4. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  5. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  6. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
Trading Center