Virtual stock trading is the practice of using simulated money to trade stocks for the purpose of fun or practice. There was a time before computer simulations when this was done on paper, but now most virtual stock trading uses computer software. Many virtual stock trading services are set up like online games, and they allow an individual to make trades based on the actual behavior of real stocks in the market. Some online investment services allow people to trade stocks virtually during a trial period to see if they like how the service works.
The Internet has made a big impact on virtual stock trading because it allows for real-time stock market quotes. This generally means that investors can get a sense of how they would do with real money in the market. Some services have a lag compared to the real market, while others react instantly.
Virtual stock trading has generally become an important part of the investment training process for many people. It is even used in educational environments to train people in various trading strategies. These simulations are generally considered a very realistic way for a person to get his feet wet in trading before he actually puts his money at risk. In fact, some experts suggest that people shouldn't do any real trading without doing some virtual stock trading first.
Many stock market experts also rely on virtual stock trading. It is generally common for stock market professionals to spend a lot of time coming up with investment strategies that might work in different market situations. These investors might take advantage of virtual trading to put those methods to work and see if they actually produce the expected results before risking their real-life funds.
Different virtual stock trading services have very different focuses. Some are designed mostly for fun, and they allow people compete against each other for prizes or prestige. Others are designed for professionals and people trying to learn about stock trading. Either kind of service can potentially be educational, but some offer more detailed simulations and allow for options that are commonly seen in actual online stock-trading services.
Some stock trading simulations are free services, while others charge a monthly fee. The free services are often more bare bones, while the professional services may have more realistic options. There are also services that are really demonstrations for actual stock trading systems, and these are sometimes free, but they may not have any services geared towards online competition.