I've been trying out trading stocks on Investopedia, and I made a decent, consistent rate of return. I'm wondering if the simulator is accurate of real stock trading? What factors between the two would be different, and would the differences negatively impact my results

edit: I also wonder if the volume impacts my trading as well..usually on the simulator my trades almost always go through at the price I want..is it the same in real life?

  • Have you got a link for the simulator?
    – Victor
    Jan 27, 2015 at 20:44
  • 1
    Not now, but if you google investopedia simulator its the first hit
    – John Doe
    Jan 27, 2015 at 21:45

1 Answer 1


Using any simulator will never be exactly the same as real trading. One reason is that a simulator will always execute your trades at the exact price you want, but that may not always happen in real life.

For example, if you place a limit order to buy 1000 shares of a stock at 10.50, and the price drops down to exactly 10.50, then the simulator will execute your trade and you will have 1000 shares at 10.50. But in real life, the price of the stock may drop to 10.50, but other people may have buy orders ahead of you. If the price of the stock drops to 10.50 but then starts going up again, you may not get all the shares that you wanted (or you may not even get any shares at all) due to the fact that people were ahead of you.

In real trading there is also slippage, which you don't see in a simulator. For example, if you have a stop order to sell 1000 shares of a stock if it drops to 7.50, then the simulator will sell all 1000 shares at 7.50 if the price drops to 7.50. But in real trading, if the price drops to 7.50, then you may not be able to sell all 1000 shares at 7.50 if there's not enough liquidity or the market is moving very fast. You may end up selling 100 shares at 7.50, 100 shares at 7.49, 100 shares at 7.48, 50 shares at 7.47, 50 shares at 7.46, 200 shares at 7.45, and 400 shares at 7.44.

Another thing is that you don't experience the emotional aspect of trading with a simulator. If you buy a stock in a simulator and it goes down, it's not real money, so you may be more willing to hold it and wait for it to come back up. But if you are trading real money and the stock goes down, you may not be so willing to hold if it goes down. You may be more apt to sell the stock for a small loss before the loss gets too big.

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