What Are Stock Simulators?

img source: techbullion.com

Becoming a stock broker is hardly a career path that anyone can be successful at. The sheer amount of things that can go wrong at any time and the speed at which you can either make it big and become a millionaire or lose everything overnight is extremely tough to deal with. For this very reason people are unwilling to choose the job of a stock broker as their calling. No matter how much you like finances and trading, the stock exchange will have numerous challenges in store for you right from the start. If you do end up deciding that this is the right choice for you, you will need all the help you can get. We are here to help you with that by talking about stock simulators.

About Stock Simulators

img source: admiralmarkets.com

As their name suggests, they are something that simulates the real thing. As such, you can probably conclude on your own that they have something to do with training and practicing. Using a trading simulator is probably the single most important step that you can take when you are just starting to trade or invest. Without them, things will feel and actually be much harder. The simulators will allow you to make as many mistakes as you want in a simulated environment without costing you any real money, as they literally exist so that the newcomers can practice and prepare for real-life scenarios.

Once you get involved with a simulator, it enables you to trade for free, to make mistakes for free, to really get invested in the stock market, and to learn at your own pace without having the fear and the risk of losing tons of money while you are still learning and getting the hang of things. You should learn and make mistakes on a simulator first so you can learn at your own speed without any pressure while getting the right amount of education both from your good and bad business moves.

Once you are comfortable and confident enough, then you can dive into the real thing and start using real money. One thing to consider while using the simulator is that the PDT will not apply because of the account size. One should learn how to get over the pdt rule in the best way possible, so make sure to check here as you learn in the simulators. This will ensure that once you open a real account you would already have it at the back of your mind.

How it Works

img source: moneycrashers.com

When you open a stock simulator and decide to use it to practice, you will be given a set amount. Starting with a given amount is good because it is not something you can expect and prepare for and therefore presents a good real-life scenario to use as practice. A good stock simulator to start with is Investopedia. It will show you your buying power and then it will show you your potential annual return. This is where you can buy stocks that you are interested in and it will calculate all your returns and everything within the simulator. There are a number of things that are going to be completely new to a beginner and this is where you need to be practicing them, not with live money.

When you are still doing things in a simulation game, you can also see your rankings and how well you are doing against other people, who will be your future competitors, which also just makes it a little bit more fun and competitive right from the start. As you know, the profession is a very competitive, treacherous, and hectic, so being compared to others from the very beginning is good for your confidence and motivation. It is a good place to start as a beginner because all you need to do is track some positions and you can do research on the side at the same time. This is basically just meant for you to practice order entry and keep you engaged in the market at all times.

Getting the Hang of Things

img source: thebalance.com

Once you have gotten the order entry down, you can move on to another simulator like TD Ameritrade’s thinkorswim. This one is a little bit more advanced and requires some previous knowledge of the basics. You can begin with a paper trading account, then once you feel comfortable with it, you can easily transition to life to trade. You are still trading with fake money, make no mistake about it, and again, you are given an amount of options with different buying power that is going to basically give you the ability to trade anything you want to trade with the simulated money. In case you want to specialize in trading a certain type of goods, this is the best way to practice exactly that.

Thinkorswim has all the capabilities of the traditional platform with live money. The only difference between this and the live trading is that you are going to have delayed data. The data is going to be delayed by 20 minutes when compared to the real deal, but since it is fake money and for educational purposes, that does not matter and it is enough. This is where you can start to really learn how to trade.

img source: investopedia.com

You can start studying charts, then you can go in and start playing with the chart timeframes, customizing the charts, and figuring out what works for you along the way. Do not be afraid to try out everything and play around with the different settings. You have the ability to trade any options you want, as if it were real money. You can make all the mistakes you want within this fake trading account and learn how to trade options without losing money.

You are also able to use the Active Trader, which is where you can day trade using five-minute charts or any chart you want. You can also learn how to route an order. This is not that simple once you start trading and can really confuse some people. You can test out your new ideas and really push the boundaries of your trading abilities and make mistakes for free. VectorVest can help you out more with great tips about the stock market like how stock shorting works.

Previous articleRick Leventhal Net Worth 2024
Next articleJayzTwoCent Net Worth 2024