what is mock trading

Mock trading, also known as simulation trading, is the process of creating and executing stock deals that do not take place in a live market. It is a learning device used in training investors and brokers, and it helps novices efficiently evaluate their trading strategies without putting any actual money at risk. The expression "paper trading" is sometimes used to refer to mock trading, as ambitious traders would train on paper before putting their money at risk in real markets. In mock trading, an investor can practice trading strategies and become familiar with different trading markets without encountering any risk. The process replicates all the elements of an actual trade, but involves none of the risk. However, it should be noted that mock trading frequently leads to distorted financial returns and could give one a false sense of security. Mock trading is also used by brokers to test out their trading infrastructure, new products/systems, and contingency drills.