What is a stock trading simulator?
A stock market trading simulator is in some ways a market place allowing investors to trade securities online without having to invest any money. These simulators most often offer a fictitious capital to realize the gains and losses made. This capital can be limited or unlimited depending on the platform.
The main objective of a stock market simulator is of course to allow you to try your hand at trading without having to take any risk. It is therefore a qualitative learning tool since the investments made are made under real market conditions.
Finally, the stock market trading simulator is a way to access the world of the online stock market for free and in a fun way. Interesting, it allows you to discover this world and to learn by experimenting in order to improve your technique and to be able to launch yourself in real market conditions.
What are the advantages of a stock market trading simulator?
Thanks to the possibility it offers to trade on real securities and in real market conditions, the trading simulator is a really interesting training tool. Indeed, the results obtained on such a simulator are exactly the same as if you were trading with a real account.
Using a trading simulator allows you to learn the different mechanisms that govern the price of stock market assets, but also to become familiar with the different features found on traditional trading platforms such as deferred orders or analysis tools.
Finally, the main advantage of the stock market simulator is that it is risk-free and does not lead to any loss even if, of course, the gains are not real either.
How does it work?
Using a stock market trading simulator is exactly the same as using a real trading account like those offered by CFD brokers, except that the money invested here is fictitious.
You invest on the real price of the assets you choose and have the same tools and features as if you were trading with real money. Your positions are taken live and the chart and fundamental analysis data is the real data that real traders use. You can test many strategies until you are sure that you have mastered how stock market investing works.
What is the difference between a stock trading simulator and a real trading account?
The main difference between a trading simulator and a real trading account on an online platform is of course the money. Indeed, with the simulator, you will not need to make any deposit to start trading. It is primarily a training without risk and without cash profits.
However, some simulators offer contests that sometimes allow you to win some money or prizes.
In addition, some stock market trading simulators do not include all the features of brokers or offer additional features, particularly in terms of learning.
Summary of the qualities of a stock market trading simulator:
To conclude this article, we propose a reminder of the various advantages and therefore the benefits of the stock market trading simulator:
- It allows investors to train for free and learn how to organize themselves and place orders online.
- It also allows you to improve your knowledge and mastery of the markets by testing new strategies without taking risks.
- Most stock market simulators are free.
- The stock market simulator is a good way to test your level before starting to trade with your own capital.
- A simulator also allows you to identify the easiest and most profitable assets to trade.
- It allows you to create a balanced portfolio with effective hedging strategies.
- Finally, the stock market trading simulator is a great way to have fun without risk.