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Paper trading has evolved from manually writing hypothetical trades on the paper to executing trades with virtual capital on computer systems. The best paper trading apps should be intuitive, responsive, and mirror market conditions. In this article, we will explore the best paper trading apps in Australia and how to develop your trading skills through a demo account. 

Best Paper Trading Apps List

1. eToro Regulated Paper Trading App With Social Trading Features

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Best Paper Trading Apps in Australia Reviewed

eToro

eToro is a social trading app that has a responsive interface. eToro’s influence in Australia and globally has soared, with millions of active traders using the platform to execute simple and advanced trading strategies. eToro supports around 5,000 instruments, including cryptocurrencies, currencies, stocks, and indices. eToro also facilitates traders that sell and buy shares and other commodities.

eToro Trading App

Key Features

  • Crypto staking: Yes. You can stake your crypto holdings in the eToro stake pool and earn passive income from your investments.
  • Leverage: Up to 30X
  • Mobile Application: Intuitive and powerful
  • 66 technical indicators for advanced trading
  • Excellent trading platform for beginners
  • Copy trading available for paper trading
  • Paper trading account that refelcts real market condtions.
Pros

  • Excellent demo trading  interface contains advanced technical indicators and allows copy trading
  • Easy sign-up process
  • An extensive variety of instruments
  • Excellent for paper trading crypto assets
  • Excellent customer support team
  • Up to $100k virtual balance
Cons

  • Does not support the MT4 platform
  • Does not support algorithmic trading (bots)

 

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

How To Start Paper Trading with eToro- The Best Paper Trading App in Australia

etoro logo

eToro is a leading paper trading app, and the sign-up process is seamless. Let’s explore how to open a demo account on the platform. 

Step 1: Sign Up

Visit the website and click on ‘Sign Up’. Provide the information requested in the necessary fields: name, email address, username, and password. You can also sign up directly with your Google Mail account or Facebook account.

Top tip: Use a password that is difficult to guess. You can also allow Google to suggest a password and save it.

Step 2: Verify ID

You will the need to provide the necessary identity documents for account verification. eToro will inform you of the status of your account in 24 to 48 hours.

Accepted IDs include a passport, government-issued ID card, and driver’s license. You will also be asked to submit a proof of address document. You can submit a water, electricity, or waste bill, a bank statement, a notarized copy of the address declaration, credit card bills, or a land use tenement rate assessment. A court order can also work.

Top tip: eToro reserves the right to accept or reject your ID or proof of address document. If your document is rejected, you can always reach out to eToro’s support team, and they will put you through the right way to submit a document.

Top tip: When submitting your ID card, do not scan it. Snap it with your phone and ensure that all four borders of the ID are shown in the picture. Do not make any alterations to the picture.

Step 3: Deposit Funds

To deposit funds, check the top-right angle of your window and click on Deposit Funds. You will be asked to specify the currency, amount, and payment option. eToro has a minimum deposit and accepts deposits through different channels.

Accepted deposit channels:

Payoneer, POLi, rapid transfer, Skrill, credit/debit cards, eToro money, online banking, and PayPal. Each payment method may come with fees from the respective financial provider.

Step 5: Switch to Demo Account

etoro demo trader

The eToro demo trader is one of the best paper trading apps. The demo interface is intuitive, responsive, and offers amazing features. With the demo account, you can trade exact live conditions, use technical indicators, get invaluable insights, and even copy trade. Once you log into eToro’s website, click on Demo, and you will be directed to the demo interface. eToro grants you $100,000 virtual funds in your demo account. You can request more or fewer funds when you reach out to customer care.

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

What Are Paper Trading Apps? 

Paper trading apps allow you to trade real market conditions without the real risks that are involved when investing real money. Investing in any instruments is risky, and people can lose real money. With the best paper trading apps, you get to make investment strategies with virtual currencies and not lose the actual funds in your wallet. Virtual funds in your demo wallet can vary, depending on the app. Most will offer from $10,000 to $100,000. The funds are there for you to purchase instruments, execute investment strategies, make profit or losses, and learn.

The best paper trading, eToro, also allows you to copy the trading investment of pro-investors. Always remember that you cannot withdraw funds from your demo account.

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

What Is The Best Paper Trading App For Beginners In Australia?

eToro is the best paper trading app for beginners in Australia. The app has an easy-to-use interface and powerful trading tools. The demo account also mirrors an almost-exact environment and markets you will experience when you trade in live market conditions. Crypto.com offers the best bot trading experience and has an excellent paper trading interface for those who are interested in cryptocurrencies.

Top Tips For Paper Trading Safely

Often, beginner investors think that paper trading poses zero risks; however, the trading habits you develop when paper trading will influence how you trade when you start staking real money.

Set a realistic balance

This is perhaps the most important tip for paper trading. When you execute trades in live market conditions, you can only invest as much as you have. It’s important to pretend like you are investing your real money. You must condition yourself to feel the loss and pain that comes from losing money in real life. Let’s say you have $1,000 saved up for cryptocurrency investments, you probably won’t invest the whole $1,000 at once. If you invest $200 and lose it all in a day, you will sweat and fret. The feelings of fear and greed are only normal when you stake an amount that is important to you. If you set an unrealistic balance like $100,000, you will not feel the pressure that comes with trading in live market conditions.

Most paper trading apps will allow you to set a balance. eToro comes with an automatic $100,000 balance; however, you can reach out to their customer support to reduce the amount. Other apps also allow you to reduce or increase your virtual balance. 

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Conduct research and analysis

Research and analysis are the foundation of any sound investor. An investor understands that an asset has intrinsic and extrinsic value; hence, an asset’s market value may not represent an accurate description of what the asset is really worth in the market.

Let’s take an example:

The crypto winter market thoroughly depreciated the value of most cryptocurrencies and tokens. Many of these assets lost as much as 70% of their value. In the early to mid-months of 2022, the crypto winter suffocated Bitcoin, Ethereum, Sand, Mana, and other cryptocurrencies. The market was bearish, and many retail investors tried to offload their crypto holdings as fast as they could. Major players like Elon Musk and Tesla also sold some of their Bitcoin holdings. The drop may not fully represent the value of Bitcoin.

Coinbase Pro Charting

Bitcoin fell to around $19,000 per coin from an all-time high of up to $70,000 in 2021; however, what if Bitcoin’s adoption shows that the crypto may rise to around $30,000 per coin in 2023?

Understanding fundamental analysis will help you see assets as they are and not as the public thinks they are. What is the adoption volume of a particular asset? Is there a new technology that will soar an asset’s demand? How about the historical behavior of the asset? Some assets seem to do well in festive periods like Christmas, and others do not. What legislative decisions are in the works, and how will they affect the performance of an asset?

Will Ethereum’s decision to completely move from a proof-of-work model to a proof-of-stake shoot up its value? When will Ethereum fully adopt the proof-of-stake blockchain model?

Trading

How about trading contracts for difference? What data do you need to trade CFDs? You must absorb as many educational materials and helpful resources as possible. Understanding the fundamentals and nuances of CFDs will deter you from making avoidable investment mistakes. If you are investing in shares, what is the company like? What’s the vision, mission statement, financial performance, and leadership quality of the company you want to buy their shares? You also need to determine your trading mission. Some people just want to invest in viable assets for the long-term and monitor the asset a few times a week. Other investors are interested in day trading or short-term trading. Decide how much you are willing to lose and when to stop when you make enough profit.

Whether you trade shares, forex, commodities, options, indices, ETFs, or cryptocurrencies, you must conduct intensive research to understand your preferred instruments. Most importantly, different markets and instruments carry different levels of risks and corresponding ROIs. Precious metals and gold may not carry as much risk as cryptocurrencies due to crypto’s volatility, but they often yield the grandest ROIs. Company shares can be influenced by many market conditions, including the financial performance of the company, adoption of the company tools and services, or scandal, so you should always set your notifications and emails to receive timely news updates. 

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Test out a variety of strategies

Demo accounts allow new traders to learn how the trading platform works and try their hands on trading strategies. Pro-traders can also use demo accounts to execute trades, make profits or losses, and replicate the trade in similar market conditions if a profit was made.

To make demo trades more realistic, traders must consider slippage. That is, they must take away slippage values from orders that are less likely to be executed in a live market.  

Slippage

In real market conditions, orders are not always fulfilled at the price you want. Slippages lead to market orders being fulfilled at expected prices or a part of the position fulfilled at a different price than the market order (in the case of a large order). A demo account does not include slippages.

Many pro investors believe that results from trading a position on a demo account can be speculative; hence, many people make decent profits when trading on a demo account but lose repeated trades in the live market. To prevent such occurrences, you must always calculate slippages and remove it from your trading value after every entry or exit.  

Make Assumptions like You are in a Real Market

If you place an order and it is executed a tick or a cent of the low point or high point of the order, you must assume that the system did not execute the order. Of course, the demo will record the order as executed, but you must trade with a live condition mindset. When accounting for slippage, assume that there is a cent slippage when you trade high-volume stocks. Every asset presents a unique slippage value, and you should assume that such slippage affects your profit line.

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Create a risk management strategy 

With proper risk management strategies, you can make decent profits—and even incredible profits from your trades; you can also minimize your exposure and losses. Trading without risk management will lead to unprecedented losses. While you may not feel the full pang of investment loss when paper trading, you will feel it when you switch to live market conditions.

Risk management is the most important strategy you can execute every time you trade. While often overlooked, many investors have lost months and even years of gathered profit from a single bad trade. In real life, risk management simply means taking an umbrella out just in case it rains. 

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Choose the right broker

Always choose a broker with low and reasonable commissions and in-depth analytical tools. As an active trader, your charts, technical indicators, and analytical tools should co-exist within a single interface. Going back and forth from one app to another because of educational resources and analytical tools will drain you. Some brokers do not also cater to frequent traders. Their high commission and fees on trade would cut deep into your stake.

Set Your Take-profit (TP) and Stop-loss Points

The TP and SL points are points where a trader is willing to pay or sell. When a trader determines his ROI and uses technical indicators to determine if he can reach the ROI, he executes the trade; otherwise, he doesn’t.

Unsuccessful traders often do not know when to take a profit or loss. They often hold on to a position after a loss, hoping that the instrument’s price will rise again. They also hold a position for too long after a profit, hoping that the instrument’s price will climb and they will earn more money. The trick is to determine your sell points, whether you make a profit or a loss. 

Oanda Charting

An SL—Stop-loss point is the price you will sell an instrument (stock, crypto…) and take your loss. An SL point pushes you to sell when a trade does not favor you. It protects you from holding on for too long. Technical indicators determine an SL point. You should sell if the instrument breaks a key technical indicator, say, a key support level. Don’t hold on wishing the price will come back. 

A Take-profit point is a price you must sell your instrument to make a profit. A sharp jump in a commodity price may signal that the market is heading towards a turnaround point. For example, if bitcoin is reaching a key resistance level, it shows that prices of the instrument jumped due to excessive demand and may drop anytime. Holding on to a position and not selling with hopes of continuous price rise is a gamble—and investment isn’t gambling. 

Every market exists in a cycle; hence, prices revolve—they neither permanently climb nor permanently drop. Savvy investors understand the need to jump into a market when prices are low (conditions like this can be caused by winters, global economic situations, and other factors) and leave the market when the price of a commodity has reached its resistance level.

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Take your time

Take your time to learn the platform and trading strategies for profitable trades. The best traders ask, ‘Why?’ Yes, you opened and closed a position and made a decent profit, why? When you ask the right questions, you can look into the market objectively to determine what changed and learn. Take your time, but don’t spend too much time in the paper trading world—you may soon lose grasp of what is real and what is not.

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Pretend that it’s your real money at risk!

Real-life trading often happens in a mist of three emotions: hope, fear, and greed. When you open a position, and the asset’s price moves against you, you lose money. However, since demo account capital is often endless and not real, you may decide to hold the position with hopes of a positive price change. In real life, if the support level shows that an asset’s price will keep on falling, you should sell at a loss. Hope does not push commodities’ prices up.

Fear: People often sell when they should hodl because they are afraid of further price drops. If key support indicators show that a commodity has reached its accumulation phase and can only go up, you should hold. However, many investors will sell because market sentiments are negative.

Greed, on the other hand, makes you hold a position longer than you should when resistance indicators suggest otherwise.

When demo trading, you must condition fear, hope, and greed and train yourself to resist their control over your decision-making process.

78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Best Paper Trading Apps Australia- Our Conclusion

The best paper trading app is eToro. eToro’s magnificent and clean interface, user experience, decent leverage, deep-dive investment guides, resources, and technical indicators, make it one of the best paper trading apps in the world, and the best in Australia.  

etoro logo

FAQs

Is paper trading legal in Australia?

Yes, paper trading is legal in Australia. Always choose a paper trading app that is regulated by the Australian Securities and Investments Commission.

Is paper trading the same as demo trading?

Yes, paper trading is the same thing as demo trading. Before trading apps existed, investors had to write down imaginary trades on paper and calculate profits or losses from positions that they opened and closed.

Can you paper trade crypto?

Absolutely, you can paper trade cryptocurrencies. The crypto you can paper trade are determined by the cryptos the platform supports.

What is the best paper trading platform?

eToro is the best paper trading platform because it is regulated in Australia and offers social trading features. It also offers up to $100k paper trading balance

kemi
kemi

Kemi is a research writer and editor, and she explores news features on tech topics from blockchain to NFT, architectural rendering, metaverse, cryptocurrency, and home automation. When she isn't reading or writing, she spends time with her family.