A stock trading simulator allows you to practice trading without trading with real money. It’s called paper trading. Another name for a trading simulator is called a virtual account. Nothing beats real-world experience as a trader with real money. However, it’s very important to start practicing in a virtual account first to help prepare you for real-world trading so you don’t lose money.
“If you’re gonna play the game, boy, you better learn to play it right.” Famous words from a famous song, The Gambler. So, if you want to play it right and know when to fold them, you better show up to the table prepared. There’s no better way to do this than to practice.
Best Trading Tools
Table of Contents
What Are the Best Stock Trading Simulators?
Stock Trading Simulators Introduction
Practicing trading in a stock simulator is essential to becoming a good trader. You don’t want to get burned out or turned off to trading early on by making common mistakes that are completely natural, but the consequences are avoidable. Read more about that below.
Do you want to be a gambler? It’s all fun and games until you’re broke. Practice makes perfect” is one of the oldest yet truest cliches.
Remember when you tried to learn how to ride a bike as a kid? Unless you were some form of child prodigy, did you jump on without the training wheels and were an instant pro?
No, probably not. It took lots of practice before those wheels came off, right? Not to mention all the bloody knees and elbows once those wheels came off.
Think of a stock trading simulator as a set of training wheels. It’ll help you perfect your game and strategy before the wheels come off and you’re set loose on the trading road. That’s not to say you won’t have bloody knees and a few expensive lessons. But practicing in the simulator sure helps in getting started.
Still not convinced? The best traders have a similar beginning in that most started with a simulator trading stocks before putting any real money at risk.
What Do They Do?
These practice accounts — sometimes called “paper trading” accounts — allow novice investors to simulate the stock market experience by buying stocks and assets with fake cash. With $100,000 in pretend capital (or whatever amount you want to start with. And you can build a portfolio and test strategies without taking on any real risk.
With a day trading simulator, you can hone your skills while protecting your hard-earned cash. This is because they mirror the broker’s working trading platform. Essentially, they provide the user with a virtual practice environment close to what you can get. Sounds smart, right?
You get “virtual” money so you can practice your trading strategies without going broke while making all the newbie mistakes. Most practice accounts are free to set up. How cool is that?!
Key Qualities of Stock Trading Simulators
The best stock simulators give practice users access to the same tools and environment a regular day trader would use: watch lists, stock chart screens, in-depth research, and live or slightly delayed data feeds while you trade.
Let’s break this down for you below:
1. They closely mirror the market
You want an authentic stock simulation experience. It must feel like the real thing, even when paper trading. This also gives you a chance to anticipate and get your emotions under control. TREAT IT LIKE REAL MONEY. I’ll elaborate later.
2. Type of securities available
Depending on what you want to trade, you need a simulator that allows you to practice with those securities. What if you want to trade FOREX, options, ETFs, or even hold mutual funds for 40 years? The simulator you choose needs to match you and your needs. Our list researched this for you already.
3. Quality of tools and charting
What’s the point of trading if the charting tools and platform suck. Honestly, this will make or break you as a trader. So, it doesn’t hurt to take the extra time to ensure you’re using the right platform, simulated or not. The better the sim, the better prepared you’ll be for the real thing.
COMPANY |  |  |  |
|---|---|---|---|
| DESCRIPTION | Experience TradeStation's professional-grade options trading platform, built for serious traders seeking value and power | ThinkorSwim is for more advanced options traders. It features elite tools and lets you monitor the market, plan your strategy, and implement it in one convenient, easy-to-use, integrated place | Leading online trading solutions for traders, investors and advisors, with direct global access to stocks, options, futures, currencies, bonds and funds |
| HIGHLIGHTS | Solid overall trading platform • Good for futures trading • Ease of use • Reliable • Great customer service • Low commissions TradeStation > | Top charting platform • Customizable scanners and indicators • Easy order entry • Reliable • Great customer service • Low commissions Thinkorswim > | International • Ok customer service • Solid order executions • Low commission fees • Good short locates I. Brokers > |
Top Stock Trading Simulators
It would be best to play the same game with the big boys or girls.
No two traders are the same, and quite frankly, why should they be? We all have different wants, needs, and strategies that work for us. Hence, I don’t point to one stock market simulator and declare it “THE BEST.”
With that in mind, the three I listed are, at the very least, “among the best.” This is because they have consistently received high marks from both users and reviewers.
All of them are terrific trading service platforms, but what sets them apart is their advanced features. I urge you to examine them more deeply to see if they fit you!
Here’s my top five:
1. Thinkorswim by TD Ameritrade (great for practice, not so good for live day trading in 2020)
2. Trader Workstation (TWS) by Interactive Brokers
3. TradeStation – (Great all-around broker)
4. Trade Ideas (stock scanner AND a trade simulator)
5. Trading Sim – (one of the best for serious sim traders with a realistic sim environment)
1. ThinkorSwim
ThinkorSwim undoubtedly has the most sophisticated stock trading simulator available today, and it’s highly recommended for all new investors. I can’t say enough positive things about it. It’s a love affair; they are one of our favorite platforms. We even wrote a review about ThinkorSwim.
We love ThinkorSwim because it gives you access to over 400,000 economic data points from 6 continents. This platform contains the most advanced trading tools an investor can find. Period.
The scanners are completely customizable as well. Users can search for top gaining (or losing) small-cap by exchange or sectors, for example.
Moreover, the pairs trader allows you to try different long/short strategies. And, there are scanners for stocks, currencies, options, and futures contracts, so, as a beginner, you don’t need to pay for stock scanners elsewhere…yet.
If you open a TD Ameritrade account, you’ll be automatically registered for the paper money account. Otherwise, you can register to try it for free for 60 days.
What may surprise you is that you don’t need a brokerage account to sign up for thinkorswim. I’d ask you to trust me, but I’d rather you try it yourself. Just register with an email address and open up the platform.
And if you need help setting up your platform, we have a TOS Course that shows how to get set up. Or, head over to our blog, covering this epic platform.
2. Trader Workstation
We started using Interactive Brokers’ TWS as a secondary broker in early 2016, as it came highly recommended by another experienced trader in our stock market community.
It is very popular among the “hardcore” trading community, but casual investors need not fret. Interactive Brokers’ Desktop Trader Workstation is considered among the best trading platforms for advanced traders.
All of the features of the TWS platform, such as advanced charting, heat maps, and multileg options orders, are available in the broker’s simulated training platform.
It is worth noting that novices will likely find Trader Workstations overwhelming. That’s why you can take our free Interactive Brokers Platform setup course if you want help getting started with them.
Unlike Thinkorswim, however, the simulator is only available to Interactive Brokers customers. Luckily, IB has recently gotten rid of account balance openings…in the past, it was required you needed to pay ten grand to open an account, but due to the broker wars, that was removed. Yay for the competition!
3. TradeStation
Another veteran entry in the world of stock market simulators is TradeStation. TradeStation is a direct access broker with a full-featured trading platform.
Their platform is the winner of multiple accolades and is one of the most trusted brokerages in the world. This simulator isn’t just for beginners, though. It comes complete with research tools, highly customizable charts, stock chart indicators, strategy optimization capabilities, and access to community forums where you can exchange ideas with other traders.
Due to its superb strategy testing, those who are systems traders like it. It’s an expensive platform, but you can test it out for free simply by signing up for a paper trading account.
The platform is so well-received that non-brokerage clients can buy it separately. However, the price tag is steep at $249.95 per month just for simulated trading. It beats losing $250 a month making mistakes in the real trading world, though…
Final Thoughts: Stock Trading Simulators
The bottom line is trading the stock markets is a tricky business. Rarely is there a single trader – beginner or otherwise – who becomes hugely successful right out of the gate.
It’s a simple fact: practice does make perfect. One day of trading in a stock simulator can be worth weeks of training in real accounts or offline.
So, that’s why paper trading is a great way to practice and test strategies. Even seasoned traders return to paper as they test new strategies or make mistakes.
Remember, successful paper trading does not guarantee successful trading with real money. However, it’s a start, “There’ll be time enough for countin’ when the dealin’ is done.” The bottom line is you work hard for your money. The market is working hard to take money from you, so get the right training in a stock trading simulator before marching to battle with your “dollars and sense.”
If you need more help, take our free trading courses.
