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How Paper
Trading Can Make
You A Better
Trader
Rekhit Pachanekar
QuantInsti
What’s in Store Today?
● What is paper trading?
● The hidden stage
● Why do traders paper trade?
● Paper trading platforms
○ Trader workstation
○ Blueshift
● Backtesting and taking the strategy to the markets
● Do’s and don’ts while paper trading
● Q&A session
What is Paper Trading?
Tesla
Apple
GM
J P Morgan
Close 2nd
678.76
137.98
59.15
155.95
Close 9th
656.95
145.11
58.76
155.68
NOT EXACTLY!
Backtesting to Live Trading - The Hidden Stage
Backtesting Live Trading
Experiment with strategies Only when you are confident
No money on the line Real money is invested
Paper Trading - A small step between theory and practice
Why Do Traders
Paper Trade?
Why Do Traders Paper Trade?
● Confidence building
● Check deployment issues
● Does the strategy perform as expected
○ Same time period
● Impact of other costs
● Understand yourself
Why Do Traders Paper Trade?
Why Do Traders Paper Trade?
Freefall from $80 to $56
Close to your entry in 2019
Stayed or cut your losses?
Why Do Traders Paper Trade?
Investing in Apple in 2019 is
a no-brainer today in 2021.
But in April 2020, you
wouldn’t be so confident.
Paper
Trading
Paper Trading Platforms
There are many but we will look at two of them
● IB Trader Workstation
● Blueshift
Trader WorkStation
There are many but we will look at two of them
● IB Trader Workstation
● Blueshift
Blueshift - MACD Swing Strategy
Blueshift - MACD Swing Strategy
Backtest
Blueshift - Simple RSI based Strategy
Backtest
Blueshift - Simple RSI based Strategy
Go Live
Blueshift - Simple RSI based Strategy
Do’s and Don’ts
Do’s and Don’ts
• Think this is real
• Capital should be realistic
• Portfolio should be realistic
• Market impact may vary
• Don’t change strategy midway
• Check metrics regularly
• Know when to go live - time, number of trades
Complete
Webinar Recording

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How Paper Trading Can Make You A Better Trader

  • 1. How Paper Trading Can Make You A Better Trader Rekhit Pachanekar QuantInsti
  • 2. What’s in Store Today? ● What is paper trading? ● The hidden stage ● Why do traders paper trade? ● Paper trading platforms ○ Trader workstation ○ Blueshift ● Backtesting and taking the strategy to the markets ● Do’s and don’ts while paper trading ● Q&A session
  • 3. What is Paper Trading? Tesla Apple GM J P Morgan Close 2nd 678.76 137.98 59.15 155.95 Close 9th 656.95 145.11 58.76 155.68
  • 4.
  • 6. Backtesting to Live Trading - The Hidden Stage Backtesting Live Trading Experiment with strategies Only when you are confident No money on the line Real money is invested Paper Trading - A small step between theory and practice
  • 8. Why Do Traders Paper Trade? ● Confidence building ● Check deployment issues ● Does the strategy perform as expected ○ Same time period ● Impact of other costs ● Understand yourself
  • 9. Why Do Traders Paper Trade?
  • 10. Why Do Traders Paper Trade? Freefall from $80 to $56 Close to your entry in 2019 Stayed or cut your losses?
  • 11. Why Do Traders Paper Trade? Investing in Apple in 2019 is a no-brainer today in 2021. But in April 2020, you wouldn’t be so confident.
  • 13. Paper Trading Platforms There are many but we will look at two of them ● IB Trader Workstation ● Blueshift
  • 14. Trader WorkStation There are many but we will look at two of them ● IB Trader Workstation ● Blueshift
  • 15. Blueshift - MACD Swing Strategy
  • 16. Blueshift - MACD Swing Strategy Backtest
  • 17. Blueshift - Simple RSI based Strategy Backtest
  • 18. Blueshift - Simple RSI based Strategy Go Live
  • 19. Blueshift - Simple RSI based Strategy
  • 21. Do’s and Don’ts • Think this is real • Capital should be realistic • Portfolio should be realistic • Market impact may vary • Don’t change strategy midway • Check metrics regularly • Know when to go live - time, number of trades