Virtual trading v/s Real Trading? "What can I do to improve my chances of success in real trading?"
You must have developed a strategy that worked wonderfully while practicing on paper or other virtual trading platforms, where you were making money. But when you entered the real market, all that cash just vanished. Ever wondered why? Click here to learn
You must have developed a strategy that worked wonderfully while practicing on paper or other virtual trading platforms, where you were making money. But when you entered the real market, all that cash just vanished.
Ever wondered why?
The virtual trading platforms you used lacked certain features present in the real market, and even after losing your money, you might not know what those features are.
Curious to learn? Continue at your own risk
1. Bid/Ask Spread and Market Orders Execution:
Typically, virtual trading platforms execute market orders at the Current Market Price (CMP) – the price you see on the screen. However, in the real market, your buy order executes at the lowest ask price, which could be higher than the CMP. This is known as slippages, a crucial element many traders miss and get confused about when entering real trades.
Cricket Match Ticket Buying Example:
Imagine trying to buy a ticket for an India vs. Pakistan cricket match. The advertised price is ₹5,000, but due to high demand, when you actually go to buy it, the lowest price available is ₹5,500. This mirrors the bid/ask spread in trading, where the price you intend to buy at (bid) differs from the seller's price (ask).
But don't worry! At Neostox, we've tackled this challenge head-on. Here's the cool part: when you place market orders on our platform, they execute just as they would in the real market. That means your orders get filled at the price where the seller has actually set their order, perfectly mimicking real-time market conditions. It's like experiencing the real-world trading environment while still in the virtual realm. This feature at Neostox not only prepares you for the market's realities but also gives you a taste of what real trading feels like. Pretty amazing, right?
2. MTM & Real Profit in Market:
Imagine you made ₹5,000 profit the previous day and your capital was ₹50,000. You were so damn happy about it and thought, 'I am going to trade with ₹55,000 from tomorrow.'
But when you open the broker terminal, you see only ₹54,500 there. How can this be true? You saw with your own eyes that your Day P&L was ₹5,000.
This is MTM (Mark-to-Market), which essentially reflects the current value of your positions as if you were to close them at the market price. But in reality, your actual profit or loss should be assessed after accounting for all taxes, charges, and brokerages.
Land Sale Example:
Like when you sell a piece of land to someone for, let's say, ₹10 lakhs, the entire ₹10 lakhs might not be yours because there's obviously a broker's cut, then you need to pay tax to the government (LTCG or STCG) depending on which applies, stamp duty charges, and all the other stuff. With all these deductions, you might only be left with ₹8-9 lakhs in your hand. This is exactly that.
This is exactly how most virtual trading platforms display your profit. This often leads traders to believe they're making more profit than they actually are.
But at Neostox, you don't have to wait for the next day to see your actual profit; your current running profit or loss, including brokerage, taxes, and charges, is updated from the moment you take your trade. Such is the transparency we provide to give you the best of the best realistic market experience.
A pro tip: While brokerage fees are typically only ₹40 or less with a discount broker, the real culprits eating into your profits are often taxes and other charges like Securities Transaction Tax (STT), stamp duty, transaction charges, and GST on brokerage and transaction charges.
So please spare the hate on the brokers.
3. Cluttered P&L Reports and Neostox's Solution:
Ever felt baffled by those convoluted P&L reports from your broker? They're often a mess, lumping everything together, and not really showing you the real accuracy of your trades. Brokers love it this way because, hey, the more you trade, the more they earn from brokerage.
But here's where our paper trading platform Neostox steps in with a game-changer. Our Live Trading Reports are a breath of fresh air. The Dashboard Trades Summary gives you an instant, real-time overview of your market positions, detailing your overall profit and loss, and even the margins used today.
And there's more. Our Daywise Trading Summary isn't just about numbers; it's a visual story of your trading journey, showing your daily wins and losses, and breaking down your profits in both percentage and money terms. It's crucial to get a grip on your daily market strategy and performance.
Neostox's Trades History feature lets you analyze every trade with precision. It's not just the trade specifics; we're talking the nitty-gritty – fees, taxes, the works. This level of detail, often missing in other platforms, is what sets Neostox apart.
So, while others keep you in the dark, Neostox lights up your trading path with crystal-clear, real-time insights, from the big picture down to the minutest detail.
Hope you've gained some valuable insights. Stay in the loop for more