[Knyyt]

IMHO,

I am probably going to ruffle a few feathers here, but my belief is that papertrading is BS and a waste of time if it is for longer then say a week or two.
Why do i believe this?
Emotional stabilty. When you have no risk, it simply is not real. People will tend to "reset" their day after something did not work out. Would you really have gotten that fill at that price? Would you really be reading that porn site when you had that 5 contract (or 1000 share) position on? Taken that phone call while a position was on? Trailed that stop so far away or so close?

I would agree that it is "good" to eyeball something for a week or two, to try something new, to get a vague idea if this or that is possible, to try out a new piece of software, to see how this indicator setting etc, etc worked. But after that.. it is my belief that its a waste of time.

What i like to suggest to newbies, is to put on that trade. Just do not put on that 5 contract order, or that 1000 share order. Do it with 1 contract in a slower market, or 100 shares in a thick stock. Your emotions are on the line for real when you do this. Your alert, and concentrating on this trade. Will you lose money doing this? Yes. Will you make money doing this? Sometimes. What you are doing is learning what is working for you and what is not, and doing it in a way that you will not get into "to much" trouble. Order placements, record keeping, chart methods settings, stop methods, what you feel comfortable with, what problems you have in your head(fear,greed). After about 200 trades, do yourself a truthful review. How are your entries, your exits, are you attentive during the day, or are you easily distracted?
Is this what you really want? Are you looking for confirmation in many places, or are you rash? Some food for thought...

Someone once said.. "There is no perfect trade, only perfect practice."

Knyyt

[keymoo]

Great post Knytt. I am inclined to agree with you, but for a total newb to the markets I think a period of time in a paper account would be wise so that they can get used to the platforms, the charts, learn the setups. After that period of time, then trade 1 contract or 100 shares.

[Anonymous]

Originally Posted by Knyyt »

IMHO,

I am probably going to ruffle a few feathers here, but my belief is that papertrading is BS and a waste of time if it is for longer then say a week or two.
Why do i believe this?
Emotional stabilty. When you have no risk, it simply is not real. People will tend to "reset" their day after something did not work out. Would you really have gotten that fill at that price? Would you really be reading that porn site when you had that 5 contract (or 1000 share) position on? Taken that phone call while a position was on? Trailed that stop so far away or so close?

I would agree that it is "good" to eyeball something for a week or two, to try something new, to get a vague idea if this or that is possible, to try out a new piece of software, to see how this indicator setting etc, etc worked. But after that.. it is my belief that its a waste of time.

What i like to suggest to newbies, is to put on that trade. Just do not put on that 5 contract order, or that 1000 share order. Do it with 1 contract in a slower market, or 100 shares in a thick stock. Your emotions are on the line for real when you do this. Your alert, and concentrating on this trade. Will you lose money doing this? Yes. Will you make money doing this? Sometimes. What you are doing is learning what is working for you and what is not, and doing it in a way that you will not get into "to much" trouble. Order placements, record keeping, chart methods settings, stop methods, what you feel comfortable with, what problems you have in your head(fear,greed). After about 200 trades, do yourself a truthful review. How are your entries, your exits, are you attentive during the day, or are you easily distracted?
Is this what you really want? Are you looking for confirmation in many places, or are you rash? Some food for thought...

Someone once said.. "There is no perfect trade, only perfect practice."

Knyyt

I'm totally on your side here. Paper trading is a waste of time. That is why I like forex. You can trade a micro account in the real market to test ideas. In some cases, the account can be funded for like 10 bucks. Usually you need about 250.00. The idea is not to get rich on the initial deposit, just something more real than paper trading and less over-whelming than a full size contract while testing out ideas.

And since a chart is a chart is a chart, it doesn't even matter if you ultimately want to trade index futures.

[torero]

Yes, micro is the best to get started without being emotionally committed. This helps get the routine going and as the trader becomes blaze to the wins and losses, that's when profitability kicks in as he sizes up little by little. The real trick is to take emotions out of the equation (from Casino Royale), so this is the best way to do it.

[Kiwi]

LOL. Someone should disagree. So its me :p

Paper trading has a number of places in the game of developing, testing, and then trading your edges.

1. Forward testing after you have backtested an edge.
2. Building confidence that an edge works in real time ... leading to small trading to build more confidence and large trading to become rich, rich, rich !!!
3. Building confidence if you have fallen off your edge or your discipline. Too many people keep losing money too long in a bad streak. If the cause is psychological paper trading can be an effective part of recovery; as can rehearsal etc etc.

The common practice of maligning paper trading reflects a lack of understanding of where it can be useful. Like any tool, its up to the artisan to use it well.

Cheers

[torero]

I agree with kiwi in this case for people who don't trade forex because other markets don't provide small accounts with small risks. Paper trading can save unnecessary headaches and frustrations.

[ducati998]

Daytrading is not the place for novice or inexperienced traders to learn their craft.

Daytrading is the most difficult timeframe to be successful in. Novice traders and inexperienced traders should start on at least weekly data based trades and possibly even monthly.

The closer you get to the noise of the market, the more mistakes you will make for the simple reason you will encounter all of the following;

*stop-running
*price manipulation for institutional fills
*liquidity providers
*volume based on derivative hedging
*Fundamental based news that is released intra-day

Until you can trade these in a longer timeframe successfully, what evidence suggests that you can trade these successfully in a compressed intra-day timeframe?

The answer is that only 1/100 will start as a novice within daytrading and actually succeed from the get-go.

Would you perform brain surgery without 5yrs Medical School and 7yrs as a specialist [surgery]?

If your answer is no; what makes you think you can outcompete the specialists out there with 10yrs,20yrs experience?

No qualifications save a $25K stake are required to enter this "profession".
If you enter as a novice, you will lose your money.
Knowledge, Experience, Courage are required prior to the "dream".

jog on
d998

[Kiwi]

Are you convinced that learning to trade weekly timeframes will prepare you to trade 5 minute or lower timeframes?