subject: Are Stock Simulators Worth It [print this page] I understand your reservationsI understand your reservations. Youve worked hard to save a little money, and you certainly dont want to lose it because you werent prepared. I get it. What I want you to understand is that a simulator is not real preparation. I repeat: stock simulators are not real preparation for investing.
There's an old story about a man who was going to duel. He bragged that he was an expert marksman with a pistol and could crack the stem of a wine glass at 100 yards.
His companion wasn't impressed. "Yea but can you do it with a loaded pistol at your heart?"
I tell that story to answer the question posed in the title of the post: No. Stock simulators are a waste of time. Paper trading simply doesn't let you experience the hope, fear, excitement and greed that are injected into investment decisions when you're under real pressure with your own money on the line.
In many ways, its like meeting a beautiful woman at a bar. If youve ever tried to approach a woman in this situation, you know that there is no amount of rehearsing- mentally or otherwise- that can prepare you for that moment. Its intense. You could visualize yourself being cool, calm and confident and picture it vividly. All of that crumbles, however, when its time to make your move.
So what do you do? You take a deep breath and silently acknowledge that you could completely embarrass yourself and screw things up. It would be bruising to your ego. If you make the right decision, though, you will also acknowledge that your desire to succeed is worth more than your fear of failure. So you go in and do what you need to do.
Investing is the same, my friend. You can run all of the analyses. In fact, you should. But there is no substitute for putting your money where your mouth is and riding out the ups and downs.
You have to have skin in the game. Only when you're in the real market will your concentration truly be engaged. Combat veterans often speak of all of their sense being heightened to a higher and more intense degree than theyve ever experienced in their first firefight. They know that there is no reset button, no do-overs. In the same vein, the market wont refund your money when you say just kidding. Its do or die.
Don't worry about losing money. Traders call this "market tuition". It's a fee you to pay in order to learn what you need to learn. Once you learn how to make money, who cares how much you've lost?
Michael Jordan knew he had the goods to make the big shot at the end of the game. What different does it make that he missed two jump shots in the second quarter?
So I urge you to get in the real stock market as soon as possible. Do it before you're ready. Get used to the feeling.
