GreatOnlineArticles.com

Today there are lots of free stock market games you can play on the web. Some are run by individual share dealing firms in order to inspire you to apply for an account with them further down the road, while others are run independently. So what the benefits and disadvantages of these market competitions? Are they worth joining or are they a waste of your time?

Well let’s start with the benefits firstly. The major one is if you are a comparative newcomer to the entire area of stock market investing, then by partaking of these games you will learn how to sell and buy shares, even though it’s only using pretend money. Additionally by buying stocks in a fictional portfolio you will start to learn about how share costs actually move and how they’re influenced both by company-specific news, and by the broader market generally. You may also hopefully learn the importance of timing and why you must cut your losses early to avoid losing significant amounts of money. Forex is a reasonable alternative, as entry barriers are seriously lower.

Another benefit of these fantasy share trading games are that there are often decent prizes to be won. So if you’re an experienced financier, you may use all your experience to try to basically win the whole competition and grab the top prizes. So there are several reasons why you should think about entering some of these competitions, but they do also have their downsides also. The 1st downside is if you are a professional financier and you spend one or two hours researching which firms to purchase and offload in your fantasy portfolio, and you do not win any prizes, then you have wasted a lot of time. This time could have been used more wisely making an attempt to grow your real-life portfolio instead.

Additionally although these games can be academic for unskilled backers, they cannot ever recreate the real-life trading environment where you actually buy and shares with your very own money. The mindset is totally different because when it’s your very own funds you are way more inclined to bank profits quickly and cut your losses as soon as practicable. And naturally your strategy will be different because with fantasy games you are often looking to buy the high-risk small-cap firms so as to achieve enormous gains and hopefully win the competition. Here fundamental analysis will play a great part.

So they do not necessarily reflect real-life trading, but ultimately it’s down to you whether you need to pass the time entering these stock market competitions. I would certainly advocate them if you re new to investing and need to learn the ropes, but I would not always recommend you spend excessive time on them if you’re a professional financier because your time may be better used on your own portfolio.