Paper Trading - Simulated trading in real market conditions

IB PaperTrader

Practice your trading skills in a simulated trading environment with an Interactive Brokers Paper Trading account. If you currently have an IB account, you can experience the full range of Trader Workstation's trading capabilities in a real-time market environment without risking any of your own money.

IB's Paper Trading accounts let you watch how your strategies play out as you develop, practice and perfect the skills you'll need to trade:

Learn market dynamics for new exchanges and products.
Test new strategies, products, exchanges, order types with prices and account values determined by real-time market conditions – all without risk.
Access essential trading tools – real time charts, executions, market depth, option pricing, price risk analytics and more.

Practice trading with all the same symbols and features you plan to use for live trading.
Access a Paper Account statement every day you trade.
Test your IB API (Application Program Interface) trading solutions.

How It Works

The TWS PaperTrader works just like your production account. You can use most IB order types, trade all contracts available through the TWS, and experiment with almost every aspect of the TWS platform.
The PaperTrader interface clearly indicates that you are working in a simulated account. If you do not see this, you are trading in your production account and will be liable for all trades that fill.
Trades entered into this paper trading account will not actually execute on any exchange or settle at a clearing house. However, the price of your executions will be determined by real market prices and sizes.
Trading permissions, market data subscriptions, base currency, and other account configurations are the same as specified for your regular account.
A paper trading account statement will be provided each day and is available by logging into Account Management with your PaperTrader login and accessing the Reports menu.
All clients will start with USD 1,000,000 of paper trading Equity with Loan Value, and this equity will fluctuate as if the trades had executed in the real market.
You may reset your cash equity at any time by accessing Account Management for your paper trading account and selecting Paper Trading Account Reset (in the Trading Access menu in Legacy Account Management, and in the Trade menu in Account Management V2.0). Your account will be reset to the greater of either USD 100,000 or two times the total equity of the user's production account. Note that reset requests should be entered before 16:00 ET in order to take effect for the next business day.

Limitations of the PaperTrader

Although the paper trading account simulates most aspects of a production TWS account, you may encounter some differences due to its construction as a simulator with no execution or clearing abilities. These differences include but are not limited to:
No support for some order types including: Passive Relative, Auction, RFQ, and Pegged to Market.
Fills are simulated from the top of the book; no deep book access.
Limited combo and EFP trading.
Stops and other complex order types are always simulated in paper trading; this may result in slightly different behavior from a TWS production account.
Penny trading for US Options is not supported. You will be able to submit the order but it will not receive a penny fill.
The trade simulator will reject the remainder of any exchange-directed market order that partially executes. This may or may not match behavior of a real-world exchange. Market orders received while there is no quote on the opposite side will be held until the market data arrives (i.e. until the first partial fill).
Mutual Fund trading is not supported via IB PaperTrader.