Connect with us

Demo Trading

The Best Paper Trading Options Platforms for Beginner to Pro Traders

There’s no question about it: Options traders don’t have time to deliberate. Hesitation is a killer whenever you trade the stock market. Luckily, new traders can quickly improve their skills by practicing. How can you practice trading? With fake money, of course! Most brokerages now offer demo accounts using the best paper trading options software.

Benzinga Money is a reader-supported publication. We may earn a commission when you click on links in this article. Learn more.

There’s no question about it: Options traders don’t have time to deliberate. Hesitation is a killer whenever you trade the stock market. Luckily, new traders can quickly improve their skills by practicing. How can you practice trading? With fake money, of course! Most brokerages now offer demo accounts using the best paper trading options software.

Just like Monopoly, paper traders are given a bankroll of fake cash and can buy or sell any securities they wish. Paper trading takes place during open market hours so price changes can be tracked in real-time. If you’re a trader who wants to learn options, a paper trading account is a necessity for honing your skills.

Best Paper Trading Options Platforms:

Why Paper Trade Options?

Options can be risky trading vehicles, especially during volatile markets. Profits and losses can be multiplied exponentially when using options and an uneducated trader might see a bankroll evaporate quickly. Reading articles or books about options trading can help, but there’s no substitute for experience.

Paper trading allows you to can gain experience without putting any money at risk.

Testing different options strategies and techniques is easy because you can watch trades unfold in real-time. Though paper trading is crucial for anyone trying to learn a new market, it’s also important to understand the limitations. Paper money isn’t real — you won’t feel the same pain after a big loss that you would with actual money.

Keeping your emotions in check is a huge part of trading and paper accounts simply can’t recreate these mental hurdles. In fact, too much paper trading might lead to overconfidence and you could develop some bad habits.

Trading fake money is great practice for the real thing, but make sure you understand the difference between a scrimmage and a game.

Key Features of Great Paper Trading Platforms

Paper trading software needs to be as close to the real thing as possible, so you’ll want to choose a software with plenty of research and tools, real-time market prices and an interface that allows seamless trading.

Paper trading is a great way to familiarize yourself with how various technical indicators work and how they react in different types of markets.

Here’s what to look for when searching for paper trading software:

Highly customizable analytical tools

Don’t be shy about incorporating new technical indicators or chart patterns into your trading strategies. The point of paper trading is to learn how to trade options.

Reading up on technical analysis is one thing, but seeing it in action is entirely different. Make sure your paper trading software is loaded with analytical tools. There’s little consensus on what works best so each trader will have different favorites.

Accurate market quotes

You don’t want to be trading on old data, do you? Most free paper trading programs will have some kind of delay on price quotes, but anything older than 20 minutes won’t help you if you want to practice during open market hours.

Functional interface

A clunky or archaic paper trading program will provide a lot more frustration than education. A little trial and error might be required to find an interface that works, but avoid anything that requires a dozen mouse clicks to execute a simple trade.

Realistic user experience

Paper traders have no skin in the game and don’t face any real consequences for losing money. If it feels too easy like a video game, you might not get much out of it.

The best paper trading platforms don’t just simulate the experience — they’re identical to the platforms used by traders who risk real capital.

Our Top Picks

Using the above criteria, we’ve chosen the best paper trading programs for options. You’ll recognize plenty of names on this list, but there are a few newcomers who have competed to make the options market simpler and more accessible.

Try to keep your paper trading activities in line with how you’d throw around your own personal capital. If you manage risk well in your paper trading account, you’ll be better prepared for live markets.

Remember, brokers want you to have success in paper trading. The more success you have with fake cash, the more likely you’ll be in putting money into a brokerage account, and that means commissions for the broker.

Commissions

$0
$6.95 for OTC Stocks

Account Minimum

$0

Best For
  • Novice investors
  • Retirement savers
  • Day traders
Pros
  • World-class trading platforms
  • Detailed research reports and Education Center
  • Assets ranging from stocks and ETFs to derivatives like futures and options

1. Best Overall: Thinkorswim by TD Ameritrade

Thinkorswim remains one of the most sophisticated platforms on the market. If you have a TD Ameritrade account, you’ll get 2 different paper trading accounts. One is a standard margin account, the other is an IRA; both come fully funded with $100,000 each.

TD Ameritrade isn’t the first company to come to mind when you think options brokers, but the Thinkorswim platform has some terrific tools specifically for options trading. And it’s all available for both live and paper trading accounts.

Take the Strategy Roller, for example. This feature allows you to develop your very own covered call strategies using certain rules established in advance. Strategy Roller will take your predetermined strategy and roll it forward each month until you stop it manually.

Thinkorswim also has Options Statistics, specialized tools for traders to find entry and exit points on options trades. The Sizzle Index measures the day’s options volume in comparison to the last 5 trading days.

With over 400 technical indicators and access to the CBOE’s TradeWise options newsletter, Thinkorswim gives paper traders more than any other platform.

Learn more about paper trading with TD Ameritrade or read Benzinga’s full TD Ameritrade Review.

Commissions

$0 for stocks and ETFs
broker assited orders an additional $6

Account Minimum

$500
to open an account

Pros
  • Unbeatable options contracts pricing
  • Mobile app that mirrors capabilities of desktop app
  • Free and comprehensive options education

2. eOption Paper Trader

eOption may not be a household name, but it has offered low-cost brokerage services for options traders since 2007.

Commissions are only $3 for equities plus $0.15 per option contract and clients can even trade the underlying stocks and ETFs themselves. Automated trading programs and mobile apps are available too, but new traders can test their hand using eOption’s Paper Trader.

Using Paper Trader, you’ll get $100,000 in fake money to trade both options and equities.

The platform is completely customizable, so users can change the layout to suit their preferences.  The probability calculator lets you know the odds of your potential trades and you’ll have access to the full quotient of eOption newsletters and research. Note that there are no commissions on paper trades.

To open an account with eOption, you’ll need $500 (and $2,000 to use margin).

Learn more about paper trading with eOption or read Benzinga’s full eOption Review.

Commissions

$0.005 per share
minimum $1 and maximum 0.5% of trade value; volume discount available

Account Minimum

$0

Pros
  • Comprehensive, quick desktop platform
  • Mobile app mirrors full capabilities of desktop version
  • Access to massive range of tradable assets
  • Low margin rates
  • Easy-to-use and enhanced screening options are better than ever

3. Interactive Brokers TWS Paper Trader

Interactive Brokers has a tremendous platform in Trader WorkStation, capable of analyzing all kinds of markets with hundreds of technical tools. It’s definitely an intimidating program to the inexperienced trader, but thankfully Interactive Brokers offers a paper trading account with nearly all the features of the live platform.

With $1,000,000 in fake cash, you can play around with different things, especially the options trading tools.

The Options Portfolio algorithm with automatically adjust your account to the Greek risk dimensions (delta, theta, vega or gamma) while factoring in commissions and decay. In the Options Strategy Lab, you’ll be able to enter your own intricate option orders and compare up to 5 different strategies at once. You can filter by characteristics like strike price or expiration and enter orders based on your experiments.

Not well-versed in options lingo? The Probability Lab explains options strategies in simple terms without the head-spinning math formulas.

Learn more about paper trading with Interactive Brokers or read Benzinga’s full Interactive Brokers Review.

Commissions

$0

Account Minimum

$0

Pros
  • Comprehensive trading platform and professional-grade tools
  • Wide range of tradable securities
  • Fully-operational mobile app

4.TradeStation

TradeStation’s platform used to only be best for professional traders who needed a highly technical platform. Now, with TradeStation’s new TS GO account option, novice traders will have access to professional-grade stock screeners and extensive educational and development tools to help them develop as investors.

Another strength of TradeStation is the number of offerings available to trade. From stocks to ETFs to futures contracts to cryptocurrencies, TradeStation offers a wide variety of tradable assets. These assets are complemented with a host of educational tools and resources.

Furthermore, as is the case with other brokerages on this list. TradeStation offers $0 commissions on stocks and most ETFs.

Read Benzinga’s full TradeStation Review

Commissions

$0
when you trade stocks, ETFs, options, and mutual funds online

Account Minimum

$0

Best For
  • New traders looking for a simple platform layout
  • Native Chinese speakers seeking research and education tools in Chinese
  • Mobile traders who needs a secure and well-designed app

5. Firstrade

Firstrade is a solid choice amongst the dizzying array of brokerages in the market; all fees are set to mirror (or beat) robo-advisor pricing. In fact, Firstrade offers free trades on most of what it offers.

You can monitor your portfolio’s performance easily with the Firstrade mobile trading app, which offers a more dexterous option compared to a desktop. You’ll be exposed to a touch ID screen for iOS devices, equity ratings and fundamental data, advanced charts, comprehensive dashboard and improved research and trading interface.

Since the advent of Firstrade’s fairly recent Navigator, it’s possible to manage your account, place orders, get market updates and do research, all almost simultaneously. The single screen allows traders to immediately intuitively grasp Firstrade Navigator’s account dashboard. Take note, however, that a lot of the options available on Navigator are geared toward active traders.

Commissions

$10/ month to trade commission free

Account Minimum

$0

Tradier

Tradier is a high-tech broker for active traders. Tradier differentiates itself by using application programming interface (API) technology to partner with popular trading software to offer a wide range of platform choices. 

Tradier invented the idea of an API-integrated brokerage firm with customizable interface options. Most brokers lock you into a pre-set interface, allowing you limited ways to customize your trading station, but not Tradier. You can integrate your platform of choice into your Tradier workstation while you take advantage of Tradier’s low fees and commissions. 

Tradier is compatible with a wide range of platforms:

  • Esignal
  • Orion Multi Trader
  • Stockstotrade
  • Q.ai
  • Screener.co
  • 1Option
  • eSignal 
  • And more! 

Its tradable assets include stocks, options and ETFs and its TradeHawk mobile platform is available for an additional fee with fast-streaming data options. 

It requires a $0 minimum investment and two fee schedules. The standard equity and options trading comes with $0 fees per order and $0.35 per contract. If you’re a particularly active trader, you might prefer Tradier’s all-inclusive subscription model. 

  • It’s $30 a month for commission-free equity and options trading. 
  • You’ll pay $10 for broker-assisted trades, which is significantly less expensive than competing brokers.
  • Tradier’s current margin rate is 5.25% for all traders, no matter how much margin you use.

Make Your Choice

You’re going to need an actual brokerage account to get full access to the best paper trading platforms for options, but many offer free demo accounts for prospective clients to try out. Take advantage of these demo accounts and sample a few different platforms. Paper trading is all about gaining experience, so taking a platform for a test drive is the best way to make a decision.

Once you master paper trading, you’ll need the right broker and strategies. Check out Benzinga’s picks for the best options brokers, our guide to all the brokers that offer free options trading, and our favorite options trading books.

Benzinga’s #1 Breakout Stock Every Month

Looking for stocks that are about to breakout for gains of 10%, 15%, even 20% potentially or more? The only problem is finding these stocks takes hours per day. Fortunately, Benzinga’s Breakout Opportunity Newsletter that could potentially break out each and every month. You can today with this special offer:

Click here to get our #1 breakout stock every month.

Continue Reading
Advertisement

Broker news

Donald Trump blasts ‘fools’ who oppose good Russian ties

US President-elect Donald Trump has posted a progression of tweets censuring the individuals who contradict great relations with Russia as “‘dumb’ individuals, or nitwits”.

Mr Trump promised to work with Russia “to comprehend a portion of the numerous… squeezing issues and issues of the WORLD!”

His remarks came after an insight report said Russia’s leader had attempted to help a Trump race triumph.

Mr Trump said Democrats were to be faulted for “gross carelessness” in permitting their servers to be hacked.

In a progression of tweets on Saturday, Mr Trump said that having a decent association with Russia was “no terrible thing” and that “lone “idiotic” individuals, or simpletons, would believe that it is awful!”

He included that Russia would regard the US increasingly when he was president

Continue Reading

Broker news

Bulls and Bears Took on More Currency Exposure in Week Through January

he most striking improvement among theoretical situating toward the finish of a year ago and the primary session of 2017 is not that modification were little. There was just a single gross theoretical position modification of more than 10k contracts. With sterling apparently not able to maintain even humble upticks, the bears added 13.1k contracts to the gross short position, lifting it to 120.2k contracts.

Or maybe, it is eminent that examiners for the most part added to positions, long and short, as opposed to close positions at the very end of the year. Examiners added to net long outside cash prospects positions, aside from in the Japanese yen and Swiss franc where 2.6k and 2.5k contracts were exchanged separately. Examiners likewise added to gross short positions. Here there was just a single exemption, the Japanese yen. Despite the fact that the dollar shut comprehensively higher in front of the end of the week, every one of the monetary forms we track here, spare the Mexican peso, picked up against the dollar in the three sessions since the finish of the CFTC reporting period.

Every once in a while it is helpful to review why many market members take a gander at the theoretical situating in the cash fates advertise. It is not that the outside trade is essentially a prospects showcase. It is principally an over-the-counter market in which every day turnover midpoints in abundance of $5 trillion a day.

Trade exchanged monetary forms and alternatives represented around 3% of the normal day by day turnover as indicated by the BIS study. Be that as it may, past reviews have discovered some contemporaneous connection between’s market heading and net position changes. We think it additionally offers knowledge into a specific market section of pattern supporters and energy brokers. It is not by any means the only device, yet one of a few data sources.

One ramifications of this is albeit theoretical positions in the money fates market are moderately extensive, it is still little contrasted and the money showcase. Along these lines, it is difficult to see the genuine essentialness of a record vast position, as though there is some market top. At some point, examiners are not driving the costs, possibly there is another fragment, national banks, enterprises, as well as genuine cash that is more essential at any given minute.

We invest some energy taking a gander at gross positions instead of just net theoretical positions, which is the more customary approach. We think a more granular look is frequently fundamental. There is a distinction between short-covering, for instance, and new purchasing, however it appears to be identical in the net. Additionally, the gross position is the place the introduction is not the net position. A net position of zero does not mean the market is nonpartisan. Net positions could be huge, which implies a short press or a negative stun could in any case troublesome. The positions that must be balanced are captured in the gross measure not the net figure.

We find numerous customers are likewise keen on theoretical situating in the US Treasuries and oil. The net and gross short theoretical Treasury position has swelled to new records. The bears added 23.8k contracts to the as of now record net short position, lifting it to 616.2k contracts. The bulls attempted to pick a base and added about 20k contracts to the gross long position, which now remains at 471.2k contracts. These modification prompted to a 3.8k contract increment in the net short position to 344.9k contracts.

The bulls delayed in the oil prospects toward the finish of 2016. They exchanged short of what one thousand contracts, leaving 608.1k gross in length contracts. The bears added 4.1k contracts to the gross short position, giving them 168k. These conformities trimmed the net long position by very nearly 5k contracts to 440.1k.

Continue Reading

Broker news

3 ways to profit in the ‘year of the dollar’

In December, the Federal Reserve raised loan fees for the second time since the Great Recession and included the desire of a 2017 financing cost climb to its gauge. Furthermore, only a couple days prior, the abundantly anticipated minutes from the most recent Fed meeting demonstrated the most hawkish tone from the national bank in two years.

In the meantime, Europe has been dove into political turmoil after a year ago’s Brexit vote and the later abdication of Italy’s leader. Somewhere else, the Bank of Japan proceeds down the way of negative rates and forceful security purchasing.

Put it all together, and it isn’t astounding that the U.S. Dollar Index is up against 14-year highs.

Speculators may have missed so much discussion on account of babble about the Dow Jones Industrial Average at the end of the day almost hitting 20,000. Be that as it may, paying little respect to your assignment to stocks or your venture skyline, this sort of huge picture incline in the dollar implies right now is an ideal opportunity to position your portfolio to benefit and, maybe most critical, to keep away from a portion of the pitfalls that can originate from a solid local cash.

Here are a couple ideas dollar exchanges ought to consider:

Residential plays over multinationals

There’s a considerable measure of seek after shopper stocks in 2017 on account of an enhancing work market and any desires for a jolt under a GOP-controlled Congress and President Donald Trump. In any case, remember that not all retailers are made equivalent especially those with abroad operations that are adversely affected by the wide dissimilarity in monetary standards at this moment.

For example, retailer Wal-Mart Stores Inc.(WMT) said troublesome money trade rates shaved very nearly 2.5% off profit for each partake in the second quarter of 2016. On the other hand consider that in the monetary final quarter of 2016, athletic attire goliath Nike Inc.(NKE) saw its income development cut down the middle because of forex weights, from 12% year-over-year in consistent cash measures to only 6% including real money changes.

To take advantage of the “reflation” exchange that numerous financial specialists are counts on in 2017, you need to represent the headwinds that a solid dollar are making for multinationals at this moment. The most ideal approach to do that is to consider customer plays that do by far most of their business here in the U.S. – for example, Foot Locker Inc.(FL), which has been an uncommon splendid spot in retail throughout the most recent couple of years.

Supported money ETFs

Obviously, in the event that you need a steady portfolio, you can’t just purchase just local centered values. Geographic expansion is similarly as imperative as enhancement crosswise over parts and resource classes. Such a large number of financial specialists keep on holding worldwide plays in light of a legitimate concern for a balanced portfolio, regardless of the possibility that it implies battling a daunting struggle as a result of a solid dollar.

The uplifting news, notwithstanding, is that you don’t need to leave yourself to torment through a solid dollar and a powerless euro when you put resources into Europe. Nor do you need to stress over the yen-dollar conversion standard when you put resources into Japan. That is on account of there’s an entire group of cash supported ETFs to permit financial specialists to put their cash in outside business sectors yet keep away from forex issues.

Consider that Japan’s Nikkei 225 file is up around 25% from its July 2016 lows. The WisdomTree Japan Hedged Equity Fund(DXJ) is up 35% in a similar period on account of assurance from forex issues and a somewhat better-performing rundown of stocks – while the non-supported iShares MSCI Japan ETF(EWJ) is up only 10% in a similar period because of battling a difficult task against a solid dollar.

In the event that you need to differentiate your portfolio comprehensively, you ought to consider supported assets that incorporate the Japan-centered DXJ, the WisdomTree Europe Hedged Equity Fund(HEDJ) to play Europe or the iShares money Hedged MSCI EAFE ETF (HEFA) for developing markets.

Dollar list ETF

In the event that you are searching for an immediate play on a rising dollar as opposed to putting resources into stocks, figuring out how to exchange remote trade can appear like an overwhelming undertaking. Gratefully, there’s the PowerShares DB US Dollar Index Bullish Fund(UUP).

This ETF is attached to the U.S. Dollar Index, which is a measure of the greenback against a wicker container of other worldwide monetary standards including the yen and the euro. It’s a straight money play, however that doesn’t make it straightforward or hazard free. In the event that the dollar debilitates, you’ll lose cash similarly as though you’re putting resources into a stock that has fallen on difficult circumstances. Furthermore, obviously, PowerShares takes a little cut of your speculations en route that indicates 0.8% yearly, or $80 a year on each $10,000 contributed.

Still, in the event that you need to conjecture on the dollar or support against a solid U.S. cash keeping down other worldwide ventures on your rundown, it’s maybe the least demanding approach to do as such for generally financial specialists.

Continue Reading

Trending