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Mock trading is the process of creating and executing stock deals that do not take place in a live market. Mock trading, also known as simulation trading, helps novices efficiently evaluate their abilities to make intelligent asset purchases and trades. Users do not invest any money and so have nothing to lose by participating in this type of educational structure.
Trading cryptocurrencies can be difficult for a variety of reasons, such as a lack of a viable trading strategy and fear of losing money over time. What if there is a way to become familiar with the crypto markets without putting your money at risk? This is a technique to improve your trading skills and acquire confidence before trading on a live account. Traders who spend their time paper trading before moving onto live accounts are more likely to make fewer trading mistakes.
What is Mock Trading?
An investor can practice trading strategies without putting any actual money at risk by engaging in paper trades, which are simulated trades. The expression stems back to a time when ambitious traders would train on paper before putting their money at risk in real markets (before the rise of online trading platforms). A paper trader documents every transaction by hand to keep track of fictitious trading positions, portfolios, and gains or losses while they are learning. Today, the majority of trading simulations use an electronic stock market simulator that mimics the view of a real trading platform.
The convenience and popularity of paper trading have increased with the development of internet trading platforms and software. With the use of modern simulators, investors can trade live markets without committing real money, and the process is used to hone and optimize specific investment ideas. Even though many of these online products demand a little fee for access to the simulation programs for day trading, the expense is much lower than suffering a loss in a real-world investment agreement.
However, before you start mock trading, it should also be noted that mock trading frequently leads to distorted financial returns and could give one a false sense of security. In other words, there is a deviation from the real market because there is no real genuine capital at stake while trading on paper. The psychological aspect of risking real money cannot be overlooked. Additionally, paper trading enables investment fundamentals such as buying low and selling high, but this may be more difficult to follow in real life.
How does Mock Trading work in the Crypto Industry and how to access it on Phemex?
You must register for an account on a trading platform that provides demo trading in order to participate in it. For example, Phemex has recently launched a Mock Trading feature that allows you to practice trading crypto contracts using virtual funds, and even provides a faucet that gives out these virtual funds for free. In the mock trading environment, you will have access to real-time pricing, technical tools, indicators, and nearly everything else that live trading offers.
To help our users grow more comfortable with our platform without taking any risks, Phemex offers a Testnet as well as the more specific Mock Trading option.
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