Simulators

don't torture yourself too much.
all we are saying is this :
simulators are NOT reality.
simulators are better than paper trading.

the only real thing is live trading.

if simulator trading is not profitable, then you will know you saved a lot of money.
if it works, you will know little, but you will have to proceed to live trading (with very small size).

don't spend too much time in simulator trading though. if it works, there is little you can learn more by staying very long.
while there is a lot you will learn from actual trading.

simulated trading is good. it's better than just throw your money away.
but it's not the real school of trading, that's all. imo, it's something any new trader should do though. only when you are more experienced will you go to live trading right away to test an idea (also because you have enough money to do so).

tntneo
 
Auditrack or any other simulator is good for testing models to see if they have a sound basis, but if you haven't traded what you're trying to papertrade the results will always look rosy.

I don't have any statistics to back it up, but I think a reasonable rule of thumb would be to expect profits to be cut in half when you switch from papertrading to real money, and expect losses to double.

Papertrading is a tool and it can be handled or mishandled. I have a pet peeve about places that promote it to new traders who don't know any better. Have them start papertrading without bothering to tell them that just about anyone can make money on paper. Let them get puffed up with their papertrading success thinking they'll be the next star trader and anxious to open an account.
 
ctrader,

that was quite a statement - not that I have data to disagree, but I found its "flow" interesting - is this out of your experience or do you work for them? :)
 
Originally posted by matthew


I don't have any statistics to back it up, but I think a reasonable rule of thumb would be to expect profits to be cut in half when you switch from papertrading to real money, and expect losses to double.
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If thats true, I have some work to do. By that formula, I am below breakeven.

Thanks.
 
Originally posted by ctrader
Refer to my posts in the following thread:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=5059&perpage=6&pagenumber=8


I have studied dow for two years. I have a system that appears to work on paper. Another poster told me paper trading wasn't worth it and I should wipe my ass with paper.

I am not yet confident to go live (shit this is real money you know). Went looking for simulators. Found one... posted a question if simulators are better then paper trading, or do I truly need to go live to gain the confidence I need to trade.
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ctrader,

Imo, simulators are better than paper, but, as everybody is saying, not the real thing.

Here is something that has worked for me in testing/trying out new systems: if you have an account with a very low cost broker, e.g., IB (no, I'm just a customer) you could kick the tires of your new system by taking its Dow signals in real time, but trading 100 shares of DIA.

Again, this is not the real thing, but just another approximation - better than just paper, not quite risking $10 per point of the DJ or YM contract.

I've used this technique (using the SPY and the QQQ) and it has helped me in a couple of similar situations. of course, stocks trade different than futures, but, again, this may help.

Just a thought. Good luck. :)
 
CTrader

I would say if you aren't sure whether you should go live or not... You shouldn't. The auditrack thing sounds neat but remember it is just expensive papertrading. As someone else said in this thread, it won't be like the real thing.

-Todd
 
the amount you lose when trading is your tuition fee

your losses and subscequent analysis is how you learn to be a trader developing your own trading style

thats why simulators and paper trading are a waste of time - no pain - no gain
 
CTrader,

you might want to think about Tradestation with a CME feed to test out some of your ideas, you might find that is money better spent...

my $0.02
 
Ctrader,

What does auditrack give you that you are not getting by papertrading? Are you using a realtime feed?

I agree that a better approach is to attempt to validate your strategy through backtesting.
 
Originally posted by AAAintheBeltway
Ctrader,

What does auditrack give you that you are not getting by papertrading?
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The biggest benefit to simulation imo is honesty. The results are there and can't be changed with an eraser.
 
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