Advanced Forex Blog

Why Trading Funds Love Day-Trading, Intra-Day, Scalpers and Forex Traders

October 21, 2018 | 11:14 am | Advanced Forex Blog
October 21, 2018 | 11:14 am
Advanced Forex Blog
trading funds

Trading funds are always on the lookout traders. In my years in the trading-fund-industry, I have seen more trading funds that encourage day trading, than ones that allow it. It is key to understand the trading-funds business model, to understand why intra-day trading is the most requested trading style.

There is no right or wrong approach for a fund trading policy, however, once you apply for one, you may want to fully understand what is the logic behind the program you are signing up for.

Before we begin, it is important to stress out that The5%ers is open to any trading style. Different trading strategies have a different effect on how the fund is managing its global risk, and how it maintains it’s business modes. The more diversity we have to handle, the more challenging it gets. However, we believe our funded traders program should apply to almost any trading style, by any trading lifespan – as long as it is aligned by our risk management guidelines.

If you break down the types of traders, you come to the heart of the matter; scalpers, day-traders, and intra-day traders are all the same words used to describe short-term traders, are the most profitable and easy to manage.

So, why do trading funds love these types of traders? There are hundreds of reasons why short-term traders are preferred by trading funds. The most immediate one is that they deliver immediate results. It is important to understand that the nature of short-term trading is completely different from long-term forex trading. Therefore, the trading strategies are also different.

High Trading Volume

The best thing about short-term trading is that traders can make high volumes of trades in a single day and therefore maximize their chances of making profits. This means they can create exceptional commission from trading. This motivates them to make better and more profitable trades.

The main objective of short-term traders is to get profitable results within the day, and that is the reason why so many trading funds prefer them. The more profits the trader makes the more commission they earn, and the more money the trading fund makes.

Risk Is Tightly Managed

You may assume that short-term trading doesn’t involve risk at all, but the reality is contrary to this. Risk is tightly managed by short-term traders to an exceptional degree. This is because their main objective is to make a profit at the end of the day. Since they make commissions on profitable trades, they will manage their risks better.

Short-term traders will make trades with very little risk attached to them, because a single loss can set them back. This is why most short-term traders prefer making multiple small but profitable trades, instead of making a risky big trade.

Clean Desk at the End of the Day, No Risk Remains for Off-Hours to Monitor

Another reason why short-term traders are in demand is that there is no need to monitor the trading activity of the fund or make further trades at the end of the day. Once the business is closed for the day, all desks are cleared and trading is paused, ready to start fresh the next day. This makes it easier for trading funds to manage their own reserves since they aren’t taking any risks during the off-hours.

It also helps short-term traders make better trades. If a trader makes losses during the day, they will come back with renewed vigor to make back those losses and make a profit. The goal for short-term traders is to make profitable trades and not take risks that could leave them in the negative.

Performance Measurement is Instant

There isn’t any second-guessing involved in short-term trading, because performance measurement is done instantly. The fund gets a fast conviction, and results, so you have immediate knowledge about whether its traders have done as expected. Trading funds prefer short-term traders because they know at the end of the day whether they have made profits or made a loss. That isn’t possible in long-term trading, because you must wait to find out whether your trade has won or lost in the market.

Numerous Opportunities Every day

Short-term trading offers plenty of opportunities to traders every single day. As they are free to make quick trades, they can easily find setups on all market conditions. This allows them to make quick moves for directional trending, sideways, and wipe saw market conditions. The short-term nature of the trades also makes it interesting for traders and trading funds, because they can react to market conditions in real time.

They also don’t panic when making trades, because they can track the market in real time and make trades based on opportunities that present themselves in the market.

Position Size Can Be Larger, Because of the Tight Range Risk Taking

The position size for short-term trading can also be larger, because of the tight range in risk-taking that will help traders avoid making silly trades. They understand that the nature of trades is to get short-term results and profits. Therefore, taking big risks goes out of the window. The bigger the trade, the greater the risk attached to it. By making small trades, the position size can become larger.

The traders can also position themselves smartly in the market. The best short-term traders don’t try to think too far ahead. There is no point in getting ahead of themselves and risk upsetting their trading system.

Intra-Day Position May Evolve to a Swing Ride Taking Huge Profits

The market tends to follow patterns. It is important for short-term traders to track it every step of the way if they plan on taking advantage of any change. The intra-day position may easily evolve to a swing
ride and that allows them to make massive profits. You may think that this is a rare occurrence, but you will be surprised to learn that it happens quite regularly.  There are multiple trades made by short-term traders every single day. There is a high possibility that their intra-day position can quickly change to a swing ride. It is easier to do that in short-term trading, because of the nature of the market and the type of trades that are being made by traders.


You shouldn’t think that short-term traders are better than long-term traders, because there is no comparison between the two. They are different types of traders, who make different types of trades and use different trading strategies. There may be some similarities between them, but in general, all forex traders are valued highly by trading funds.

Short-term traders like scalpers, intra-day traders, day-traders, and forex traders are preferred by trading funds because they get them immediately profitable trades. That is what every trading fund wants to achieve in forex trading, which is why they are always on the lookout for short-term traders.

The5ers funding forex traders program is designed for a wide variety of trading techniques and styles.


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