Paper Trading: Practice and Learn Investing Without Risk

Paper trading is one of the best ways to learn about investing without risking any of your money.

What is Paper Trading?

A paper trade is simply a simulated trade that allows you to buy and sell stocks (without risking money). The reason it’s called a “paper trade” is that back in the day before computers, aspiring investors would write their trades out on paper to practice before risking it in the real stock market.

Pros and Cons of Paper Trading

Pros

- Risk Zero Money - Test Out New Trading Strategies - Get Familiar with Your Trading Platform

Pros and Cons of Paper Trading

Cons

- No Emotional Stakes - Missing Out on Profits - Not Perfect for Simulating Actual Conditions

Why You Should Consider Opening a Paper Trading Account

Even if you’re an experienced investor, paper trading could still benefit you. The stock market is constantly changing and evolving. That means that strategies that worked yesterday might not work today, and new trading styles emerge by the minute.

How to Open a Paper Trading Account

1. Research new trading platforms/brokerages which you can open an account with 2. If you already invest, see if your brokerage offers any paper or practice trading accounts.

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