● Why do some brokers hate scalpers? http://www.financial-spread-betting.com/strategies/strategies-tips.html
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Why do some brokers hate scalpers? Why do some brokers frown upon scalping? Is scalping illegal? No, its not illegal! Then, why do some brokers prohibit scalping? There is no legislation that says that you have to hold onto your trades for a minimum period of time! But there are some things you can’t do.
If you trade with brokers having direct market access to the exchange, they don’t really care because their pricing model is based on commissions from clients. The more you trade the more commissions they get.
Why do Dealers/Brokers Hate Scalping?
If you are trading with a CFD provider, you are trading against them in a technical sense. Ideally these providers want to have a balanced book where client positions even each other out. They will simply hedge the net exposure. The issue they have with scalpers is that they can’t hedge the net exposure as scalpers are too fast and this leaves brokers potentially exposed.
Original video source. Compare ECN brokers in our table.