![]() You can’t lose money since all of your “trades” are on paper only (or virtual if you decide to use an online app to track your trades). The point is to learn about trading and educate yourself in a risk-free environment. There is no financial risk with paper trading. Either way, the benefits of paper trading for investors can be enormous. Or, you can go old school and track your trades with paper and pencil. Many online brokerages include free trading simulators to help investors get used to their trading platforms and to educate them on how to make effective trades. You can access a wide range of platforms, apps, and trading games all designed to help novice investors get trading experience before committing real money. Nowadays you can do all of your paper trading online if you so choose. They would write down their buying and selling decisions, jotting down the ticker symbol, entry price, exit price, and profit or loss for each “what if” trade. Before the Internet and online trading platforms existed, new traders would track their hypothetical trades on paper. The practice of paper trading has been around for a long time. Paper trading-also known as “virtual stock trading” or “demo trading”-allows investors the opportunity to get trading experience in a realistic trading environment without risking actual money. Well, the same can be said if you are just starting to invest in the stock market. ![]() You wouldn’t fly a plane or take a car out on the road without learning and practicing in a safe environment first. Paper trading for the beginning investor is like a flight simulator for a novice pilot or a driving simulator for teens learning to drive. ![]()
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