Disadvantages of Scalping
1. High Transaction Costs: The frequent buying and selling of stocks can lead to significant transaction fees, eroding profits.
2. Slippage and Execution Risk: Rapid market movements may result in slippage, impacting the execution of orders.
3. Mental Pressure: The need for constant focus and decision-making can lead to psychological stress and fatigue.
4. Time-Consuming: Requires dedicating significant time and attention to monitor markets and execute traders.
5. High Drawdown Potential: Using relatively higher lot sizes increases the risk of significant capital loss during losing streaks.