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Paper trading options
This is a discussion on Paper trading options within the Options forums, part of the Financial Markets category; Besides the psychological effects, what are the major differences between paper trading options and trading them for real?...
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Aug 23, 2005, 2:44am
| #1 |
| Junior Member Join Date: Aug 2005 Location: LA Posts: 40
| Paper trading options
Besides the psychological effects, what are the major differences between paper trading options and trading them for real? |
 
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Aug 23, 2005, 4:05am
| #2 |
| Legendary Member  Join Date: Jun 2003 Location: Fraggle Rock Posts: 3,897
| Re: Paper trading options
erm the lack of cash involved?
__________________ Open pod bay doors |
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Aug 23, 2005, 8:10am
| #3 |
| Legendary Member Join Date: Dec 2004 Location: Massachusetts Posts: 1,909
  | Re: Paper trading options
A major difference could be in your entry/exit points. What are you using for prices when you make your paper trades? If it's the traded prices you see, then you could be way off on your own execution because options are often thinly traded so that the actual current market bid/ask might have very little in common with the last traded price.
__________________ John Forman Author - The Essentials of Trading |
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Aug 23, 2005, 9:59am
| #4 | |
| Junior Member Join Date: Aug 2005 Location: LA Posts: 40
| Re: Paper trading options  Quote:
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Aug 23, 2005, 10:02am
| #5 | |
| Legendary Member Join Date: Dec 2004 Location: Massachusetts Posts: 1,909
| Re: Paper trading options Quote:
__________________ John Forman Author - The Essentials of Trading | |
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Aug 23, 2005, 11:05am
| #6 |
| Junior Member Join Date: Aug 2005 Location: LA Posts: 40
| Re: Paper trading options
i see the bid and the ask, but the i have scotttrader, not scottrader elite, so its not level 2. |
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Aug 23, 2005, 12:21pm
| #7 |
| Legendary Member Join Date: Dec 2004 Location: Massachusetts Posts: 1,909
| Re: Paper trading options
As you have taken the psychological elements and put them aside for this discussion, then aside from maybe a little bit of slippage here or there, live trading won't be all that different than paper if you've been consciencious in your paper trades (accurate price point, accounting for commissions,etc.). Don't discount psychology, though. Traders really do change when they go live.
__________________ John Forman Author - The Essentials of Trading |
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Aug 23, 2005, 2:22pm
| #8 |
| Junior Member Join Date: Aug 2005 Location: LA Posts: 40
| Re: Paper trading options
good, cause i have been paper trading for 2 months now. i started to keep records of my trades 2 weeks ago. at the end of the first week, i was down $70 (started out with $930). but im on day 11, and in the past three days, i made $400 profit. PS: i took off $10 for every transaction, as commission. |
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