Duration: 3:16
Level: Beginner

Interactive Brokers provides all clients with access to a paper trading account which allows clients to use the full range of IBKR’s trading features in a simulated environment using real market conditions. Use this test environment to learn trading features such as order types without risk, learn market dynamics in new exchanges and products, and simulate and test trading strategies.

Study Notes:

What is a paper trading account?

All IBKR clients have the ability to open a paper trading account. A paper trading account allows traders to use the full range of IBKR’s trading features in a simulated environment using real market conditions. 

The trading permissions, base currency, and account type in the paper trading account will match the regular, live account. Trades entered in this paper trading account will not actually execute on any exchange or settle at a clearing house. However, the price of the “executions” will be determined by real market prices and sizes.

What are the benefits of using a paper trading account?

Using a paper trading account is a great way to learn how the trading platforms work and get acclimated to the trading tools before using them in a live account with real money. 

Traders can also use the paper trading account to try out new features or order types. Or they can even use the paper trading account to test out a trading strategy in a simulated environment.

How to request a paper trading account?

Paper trading accounts are requested from the Account Portal of the live account. Click the Head & Shoulders icon in the upper right corner and select Settings from the drop-down menu. 

Under the Account Configuration section, click Paper Trading Account. The paper trading account will have separate login credentials from the live account, so enter a username and password for the paper trading account. When ready, click Continue to reach a confirmation screen.

If the request is submitted prior to 4pm Eastern Time on a normal business day, the paper trading account will be ready for use by the following day.

Can the paper trading account have live market data?

The market data subscriptions for the live account can be shared with the paper trading account so that the trader does not need to pay for the same market data subscriptions in both a live and simulated environment. 

The trader can select which username on the live account they would like to share the market data with for the paper account. On the Account Settings page, select Paper Trading Account and select Yes to share real-time market data subscriptions with the paper trading account. A drop-down menu will appear to select the username whose market data is to be shared.

Note that if the market data is shared, the user cannot access the data for both the live account and the paper trading account at the same time.

In the bottom right-hand corner, the investor can also reset the paper trading account password if needed. Once the desired changes have been made, click Save.

How to login to the paper trading account?

Once the paper trading account is activated, traders begin simulated trading in either the Trader Workstation (TWS) or the IBKR Mobile app. On the login screen for either platform, make sure to click the Paper Trading button before entering the username and password for the paper trading account.

Resources

User Guide: Paper Trading Account

About Paper Trading Accounts

Additional Video Courses

Intro to IBKR Tools

Advanced IBKR Tools

TWS for Advisors, Introducing Brokers, & Fund Managers


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The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

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