Taking a paper trade is like giving a mock test before the real exam. Paper trading is a way to practice trading before putting real money at risk. It allows users to place hypothetical trades based on real-time stock market prices.
Novice traders use this to get familiar with the trading world. Paper trading is considered a safe space to learn the mechanics(slippages, etc) of placing trades. It’s the best place to practice trading real time without putting any capital at risk.
You get all the action of deploying your strategies live in the market. Taking live positions and checking order execution transaction tables that show the entire flow of your strategy is easy now. You can do all this without the risk of losing (or gaining) any money. Streak gives you a platform to paper trade all the strategies with real-time data. It helps you sharpen your trading skills.
Explained with Reliance share’s example
For example, let’s say you’ve been working on your trading strategy and believe Reliance Industries Limited (RIL) is going to breakout at INR 2000. When the stock hits that point, you would record your entry. When you felt like it was time to sell, you would record your exit. Doing this for all your trades, going through them at the end of the day and studying to see what you did right or wrong without actually putting your money at risk is essentially what paper trading is.
Jack Schwager, an eminent trader who’s widely known for his bestselling book ‘Market Wizards’, gave out a checklist to follow for new traders in one of his interviews. He said – ‘Educate yourself first. Read books and see what kind of trading style you resonate with. After that since you are following the markets, create a methodology and then paper trade it before putting real money.’ It’s highly advised to try paper trading to understand the implications of equity markets.
Paper Trading on Streak
Streak is the only platform in the world that lets you paper trade on live market data without having the need to code, in less than 60 seconds. You can trade as many as 100 strategies live on paper trade simultaneously.
If you are new to markets, you can learn to paper trade in 3 minutes using streak. Streak paper trading feature is built keeping novice traders in mind and it removes all the hassles of coding, buying data etc.
It also lets you create, backtest and deploy in papertrade mode in less than 60 seconds. Deployed strategy automatically takes hypothetical trades accounting for precise strategies along with slippage, with exact target or stop-loss getting capturing so you don’t have to manually sit and make notes of your trade, now all you have to do is just see which strategy is working and which one’s not and then decide to take your strategy live.
After putting a strategy up for paper trading, you can monitor the performance of your strategy and then deploy it in the live market (Take Live) to receive notifications only if it performs well.
You can easily deploy your strategies for paper trading with a single click now.
Important points to note:
Paper trading places hypothetical buy/sell orders generated by the deployed strategy. These orders are stored in the order log of the strategy. You can verify paper trades by following the chart and marking the orders listed in the order log.
The data in the order log for strategies deployed for paper trading is only available until midnight.