Why start with paper trading?
Suppose you want to start an investment career but you are afraid of risk. So, what should you do?
Paper trading is the answer. If you want to practice trading without risk, stress, and emotional trauma, paper trading says hello! This is the best way to develop yourself as a professional investor and to gain confidence and market experience. Paper trading is the smartest solution that can develop your trading skills without any cost. Get started with paper trading for the following reasons:
- Get general education about investing
- Practice placing trades and building a portfolio
- Test and analyze new strategies before they go live
- Learn to control emotions when investing
What is the difference between a paper trading app and a live trading app?
Several brokerage firms provide applications that support both paper trading and live trading. Such applications have great advantages. As we all know that paper trading does not involve any money and paper trading apps carry out transactions based on virtual money. This is the first and foremost difference between paper trading apps and live trading apps. In addition, the application allows you to realistically simulate the stock market. The share price of all shares will be real but your transaction will be wrong.
What are the pros and cons of a virtual trading account?
Paper trading is a very useful tool in your arsenal if you want to practice before playing trading games for real money. It has many advantages for beginners. While it has so many advantages, like all others, it has its limitations.
Advantages of paper trading
No risk: Paper trading costs nothing and you can make mistakes. It allows you to develop your own well-defined trading strategy by observing all the flaws while playing in practice mode.
Trading simulation in No trauma and emotional stress: Real trading involves emotions like fear, greed, stress, etc. The risk is not too far off when practicing through paper trading. This allows you to focus on your strategy, analysis and statistics.
Practice under real market conditions: Paper trading is a great way to practice investing under real market conditions
Confidence: Paper trading helps beginners build confidence. Through a series of successful trades, beginners can gain the confidence they need to start real trading.
Paper trading cons
Hidden fees: Paper trading platforms do not take into account hidden fees, slippage and commissions. The real world of trading is very different where the trader has to deal with some real costs. Hidden costs are too meaningful in reality.
Emotional reality: Real trading involves emotions and that is reality. Virtual trading takes away the emotion because nothing is at stake. It's very hard to put emotions aside when real money is at stake.
Technical glitches: Paper trading platforms handle entries and exits ideally. It skips the worst-case scenario when the algorithm fails in a computer-driven environment. So, technical glitches sometimes cause problems in real trading but virtual paper trading platforms exclude the possibility. This can cause some serious problems in live trading.
Key features of a great trading platform
The best paper trading platforms should remove all the previously mentioned restrictions. In other words, the best trading app should be as close to where you live as possible to trade. For effective trading practices, you should choose the best paper trading apps that can give you a real feel of trading. The best paper trading platform should have the following features.
Real-time and accurate market quotes
Old data is irrelevant in live trading, so you need real-time and accurate market data. The best paper trading platforms will not delay offers more than twenty minutes.
Excellent analysis tool
The best paper trading apps or sites should have specialized analysis tools to help you in technical analysis. Excellent analytical tools allow you to try new things like new technical indicators
What is the best paper trading platform?
Eleventh Choice is the best paper trading platform. All of them offer features that every trader wants.
E*TRADE
E*TRADE offers a paper trading platform which is one of the best virtual trading simulators. The app, available on both the website and the app, allows you to practice trading stocks, options and other equities using virtual money.
Webull Paper Trading
This app gives you an initial virtual money balance, although it can be adjusted higher or lower, of $1 million. You just need to create a Webull account to use one of these best paper trading apps.
Paper Trader Interactive Broker TWS
Interactive Brokers has an excellent trading platform with several unique features. They also offer a virtual trading simulator with almost all live platform features. Choice of Portfolio Algorithm is the most important feature. It adapts your account to the Greek risk dimension and commission and spoilage factors. The Option Strategy Lab and Probability Lab are other great features of Interactive Broker TWS Paper Trader. Its unique set of features make it one of the best paper trading apps.
eToro
Start trading shares on etoro.com with 0% commission
Compatible with both iOS and Android, eToro is one of the best paper trading apps. Offers different types of assets to learn to trade. eToro is very popular for reflecting live market conditions. With an initial virtual money balance of $100,000, eToro has all the features of the best virtual trading simulator.
plus 500
Plus500 is one of the best paper trading apps for CFDs. It allows you to trade multiple financial instruments across most asset classes. The Plus500 paper trading app gives you an initial virtual cash balance of £50,000. Your balance is returned to its original amount as soon as your balance is below £200. Plus500 takes you to unlimited practice to ensure your learning makes it one of the best paper trading platforms.
IG
Visit the website ig.com
IG comes with an initial virtual cash balance of $10,000. It also reflects real market conditions to enhance your trading learning.