A thought just occurred to me — you know how people often denigrate paper-trading because it lacks the pressures and tensions that come from trading real money? I don’t dispute that, but my thought is that the best way to trade real money is to trade, at least emotionally, like you’re paper-trading. Maybe that’s why people often seem to do so well paper-trading; when there’s nothing at stake, it seems easy. Losses don’t hurt, gains don’t really matter that much, and strategies are much more easily followed without the weight of emotion bearing down on you. Who would revenge trade in a paper-trading environment? It’d be silly, right? I think the same thing is true in a real money situation.
Posted by Nelson Yee