by Rohit 

September 11, 2020

Even after being a trader for over 10 years, I always test my trading strategy before applying it live in the market. Without testing, everything looks great on paper.

Paper trading is one of the best technique to test your trading strategy, without risking real money. Crypto paper trading apps are quite good at allowing you to test multiple strategies in one go and show the profit you can expect.

A quick list of best Crypto Paper Trading apps and Simulators

Crypto Paper Trading ToolQuick Link
3Commas Paper Trading (slightly advanced)Create Account
TradingView Paper TradingCreate Account
Cryptohopper Paper TradingCreate Account
CryptoParrot (recommended for beginners)Create Account
eToro Virtual Portfolio AccountCreate Account

All of these apps are good in their own way, so you need to read the details about them to decide which one will serve your purpose best.

Before that, if you don’t know already, let me give you a very quick intro to paper trading and how it is a useful thing to have as a crypto trader.

What is paper trading: A short intro

Paper trading means when you decide to enter into a trade (long or short), then rather than entering it into the exchange and doing a real trade, you just make that entry on paper.

You note down the entry price and when you close the trade as per your strategy, you note down the exit price. So, you have traded something, on paper, without risking the real money. Hence – paper trading.

This is especially important when you are a beginner to crypto trading. There are many benefits of trading in crypto, but there are risk factors too.

You can’t risk real money to find faults in your trading strategy. And the best way to do that is paper trading.

There is other technique used to test trading strategy and it is called as backtesting. Still, it is recommended to do real trading only after paper trading.

Here is my reason for saying so:

Why backtesting is not enough?

Almost all investment literature warns potential investors that –

”  Past performance is no guarantee of future results.”

And this is standard disclaimer in advertisements, documents by reputed, established financial institutions. Despite having decades of experience in the field. And despite, selling their future services based on past performance only.

The reason is simple – it’s the truth. You can’t guarantee that future will behave in the same way as it did in past.

Backtesting any strategy is like that only. You are testing your strategy by looking at some with perspective of future. There is a bias here and which means you won’t get the real picture about your strategy.

When you decide to trade in cryptocurrency, the best idea is to use past price movements to find out a pattern, develop a trading idea on that and then paper trade that strategy to see how it works out in real life.

Best Crypto Paper Trading Apps & Simulators

I keep testing new crypto trading related services on regular basis. The following list of crypto paper trading platforms is based on my experience with them.

Most of these services are free to sign up, so you can freely signup all of them and see which one suits your style.

3Commas Paper Trading

3Commas is mainly an AI-based bot trading platform, but it provides a very good paper trading platform too.

The only and main issue with 3Commas is that this service is available as part of paid subscription. They offer 14 days free trial though, which you can check out by clicking here.

If you are trading with more than $1000 (recommended as minimum amount), then the subcription charges become worth it through there bot trading function.

Bot trading is a slightly advanced concept in crypto trading, read about it here.

TradingView Simulator

TradingView Crypto Paper Trading

TradingView provides the best charting services currently and they are my personal favourite. They allow me to check price charts from all the major crypto exchanges.

And on top of that, they also provide paper trading simulator on the same chart dashboard.

The only, and main issue with Tradingview paper trading feature is that it allows you to paper trade only on Crypto to Fiat currency pair. Like BTC:USD

It has still not enabled Crypto to Crypto Pair for paper trading. Like, if you try BTC: USDT, it will show this error:

Trading view crypto paper trading simulator

Cryptohopper Paper Trading Platform

Crpyptohopper is a crypto-trading bot. The functions are little advanced, but not difficult to learn.

Cryptohopper provides paper trading function to test out their trading bots. The data is from public data of exchange and is real time. The best part – this paper trading feature is part of their free plan. 🙂

Click on hoppers on left – click create new hopper and choose the exchange of your choice (here is the list of best Crypto Exchanges). From this screen you can enable paper trading feature:

cryptohopper paper trading simulator

Open your Cryptohopper account here.

eToro Virtual Portfolio account

eTorro is social trading platform, where you can trade nearly all the assets like forex, commodities & crypto. What most people don’t know is that eTorro also offers paper trading feature.

You need to enable the paper trading feature in your account.

Final thoughts

As you can see, each of above mentioned trading simulators, are there for different purpose, like tradingview is for charting & 3Commas is for Bot trading.

The reason for this is simple, paper trading is to test out and improvise a strategy. It’s is real like but not the reality.

You get the real test of your strategy only when you trade with your own real funds.

So, the best idea is that once you have tested your trading strategy in paper trading, start with a small amount in your trading account on the side.

Only when you have traded more than 20-25 times on your strategy, you will know if you can invest more money in that strategy.

Please share your thoughts about this post and your feedback in the comments section below.

About the author 

Rohit

A trader and investor with over 11 years in traditional stock markets. Got introduced to cryptocurrencies in 2018 and got hooked. Now spend half of the day in trading cryptocurrencies and another half in researching/reading about the whole ecosystem and cryptocurrencies in specific.

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