Whether you’re just starting out with stock trading or working on developing a more disciplined trading strategy, a stock market simulator can help. These realistic software platforms mimic the movement of the market while offering built-in educational tools to help you become a better trader.

In this guide, we’ll explain everything you need to know about using a market simulator and compare three of the best stock market simulators you can use today.

What Is A Stock Market Simulator?

A stock market simulator is essentially a video game that lets you practice trading on the stock market with virtual money. You have the ability to build a portfolio and try out trading strategies by making virtual stock purchases with no financial risk. If all your trades go badly, there’s nothing to worry about – you can reset the simulation and start over with a new pile of virtual cash.

Notably, there are two types of stock market simulators. The first type is a simulator that mirrors the actual stock market. Typically, these use a mirrored version of a broker’s platform and give you access to all the same trading tools and options. You’ll also be working with actual market data, although it’s often delayed by a few minutes or more.

The other type of stock market simulator is more like a video game. Rather than simply allowing you to explore, these games might have specific objectives. For example, a game-style market simulator may put you into head-to-head competitions to see who can come up with the most profit by the end of a trading day. 

Why Use A Stock Market Simulator?

The main reason to use a stock market simulator is for education. By using a simulator, you can get more comfortable with a broker’s platform and try out all the various tools and functions without worrying about accidentally triggering a live trade.

More important, you can develop a trading strategy and test out different approaches to stock trading without worrying about losing money. By taking off all the financial pressure, you’re free to see whether trading based on a new indicator might work for you or whether a more or less aggressive trading style suits you. Placing more trades and seeing how they turn out – which you can do with a simulator safely in a way that you cannot with real money – will also help make you a more experienced trader.

Notably, stock market simulators aren’t just for novice traders. Experienced investors can use simulators to play around with a new trading strategy or try to apply an existing strategy to unusual market conditions to see how it fares. While this could also be accomplished with backtesting, using a market simulator often allows for more exploration and lets you evaluate your strategy in the current market environment.

The Disadvantage Of Using A Stock Market Simulator 

Unfortunately, the main advantage of a stock market simulator can also be a disadvantage. Without real risk of financial losses, many traders approach stock market simulators with a psychology that’s totally different from how they trade with real money.

If you don’t take the simulator seriously, it won’t help your trading. In fact, it could even hurt you by instilling a sense of overconfidence in a highly aggressive trading strategy.

So, it’s essential that you approach a stock market simulator with the same mentality that you would approach live trading. That means thinking about your investment goals and the need to build a diversified portfolio. It also means using techniques that help manage risk, such as stop losses and scaling in and out of positions. It’s easy to ignore these practices when you’re trading with virtual money, but you’ll get much more out of using a stock simulator if you practice like you trade. 

What To Look For In A Stock Market Simulator?

With all that in mind, what should you be looking for in a stock market simulator?

To start, it needs to be as realistic as possible. Simulators have come a long way in this respect, but there are still some key areas where software platforms differ. For example, some simulators take into account whether a large order could be filled at a specific price. If your simulator doesn’t account for this, you may be fooled into thinking that a trading strategy with thin profit margins is successful when it really isn’t.

Another thing to look for is a wealth of assets to trade. If you only plan to trade stocks, then this might not be important. But most investors can benefit from practicing buying and selling ETFs and mutual funds, in no small part to learn how to build a more diversified portfolio. Having the ability to simulate options trades is also important if you plan to trade options. Importantly, a good simulator will offer all the same order specifications that you would get during live trading with your broker.

Of course, market research tools are essential as well. Part of the appeal of using a stock market simulator is that you can practice working with these tools as you trade. You should have access to advanced charts with built-in technical studies as part of your simulator. It also doesn’t hurt to get access to other tools that you use as part of your trading strategy, such as price alerts, economic data, and news feeds.

The 3 Best Stock Market Simulators

There are a lot of stock market simulators available, some better than others. To help you find the right one, let’s take a look at three of the best platforms. 

TradingSim – Best All Around

TradingSim is a paid market simulator that starts at $24.75 per month for access to nearly two years’ worth of historical stock data. You can pick any day in the simulator’s database and trade against real-time or sped-up price action for that day for more than 11,000 stocks. Importantly, this design means you can practice trading at any time – not just when the market is open.

TradingSim’s charting and analysis platform is powerful, but not endlessly customizable. You’ll get access to drawing tools and hundreds of technical studies, but it’s not the best platform for creating or automatically backtesting a new strategy. One neat thing is that TradingSim lets you home in on the stocks that made the biggest moves on any day you choose for trading practice.

Best Stock Market Simulator - TradingSim

TradingSim offers data for futures trading on around 20 contracts, although this costs more. The simulator doesn’t support options trading.

TradingView – Best Charting

TradingView is a live and paper trading platform that combines analysis with social investing. You get access to a variety of pre-built and customizable stock screeners, plus a built-in scripting language you can use to create your own scans and indicators. Charts in this platform aren’t as in-depth as what you’ll find in some other simulators, but at the same time that makes them fairly beginner-friendly.

Best Stock Market Simulator - TradingView

One of the unique aspects of TradingView is that it includes a social network. You can strike up discussions with other traders on the platform as well as collect ideas about new trading strategies. In that sense, TradingView’s simulator is best suited for exploring what other traders are doing and then trying out those strategies for yourself.

TradingView is free to use, but your ability to overlay indicators, view multiple charts, and build screeners is limited with a free plan. Paid options at TradingView start at $14.95 per month. Also keep in mind this platform only includes stock and ETF data, not simulated trading for options or futures contracts. 

ThinkorSwim – Best Free Simulator

ThinkorSwim is a highly advanced charting and analysis platform owned by TD Ameritrade. You don’t need a TD Ameritrade brokerage account to start using the simulator, but after two months you’ll have to sign up for an account.

Best Stock Market Simulator - ThinkorSwim

Almost all of ThinkorSwim’s capabilities are unleashed for paper trading. You can use the built-in scripting language, thinkScript, to create fully custom indicators and watchlists. You can also build an unlimited number of custom screeners to search for stocks to trade.

If you’re looking for more than just stock trading, ThinkorSwim’s simulator includes options, commodities, forex, and futures trading. The only thing missing is a comprehensive portfolio manager, as this platform is built with active traders in mind.

Conclusion: Best Stock Market Simulator

Using a stock market simulator is one of the best ways to improve your trading. You can gain experience, test out new strategies, and get better at managing your profit and loss over your investment timeframe. TradingSim, TradingView, and ThinkorSwim are all highly capable stock market simulators that you can use to become a better trader.