IBKR offers a simulated trading account to clients called a Paper trading account. Paper trading lets you use the full range of trading facilities 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.
Please Note: The Paper Trading Account is only accessible once your live account has been funded. Client Portal Settings will not be available until your account has an active deposit on record.
Here is a comprehensive guide on how to access, use, and understand the limitations of your paper trading account:
Accessing Your Paper Trading Account
To access your paper trading account through Client Portal:
- Log in to Client Portal with your live trading account username and password.
- Click the User menu (head and shoulders icon in the top right corner) followed by Settings.
- Under the Account Settings section look under Account Configuration
- Click on Paper Trading Account.
- See the Paper Trading Username.
- Click RESET PAPER TRADING PASSWORD in the bottom-right corner.
- Enter the password, confirm it and click RESET.
- Use these paper trading credentials to log in to your paper trading account.
On Desktop App:
- Open the desktop app and go to the Login page
- Click on the Overflow menu (three dots in the top right corner)
- Select "Log in to Paper Trading"
- Enter your account credentials.
If You Cannot See Trading Options:
- Ensure you are using the correct paper trading account credentials.
- If issues persist, try logging out of all active sessions (IBKR Mobile App, Trader Workstation) and log in again.
Remember, paper trading account credentials are different from your live trading account username and password.
Using Your Paper Trading Account
Once logged in
- You can search for tickers, execute trades, and use other paper trading features.
- Enable "Share real-time market data with your paper trading account?" to use your live account's market data subscription.
Limitations of Paper Trading Accounts
While paper trading accounts are valuable for practice, they have several limitations:
- Simulated Environment
- Trades are not executed in real markets, leading to potential discrepancies in fill prices and execution speed
- The broker simulates the role of the exchange, unlike in live trading
- Market Impact
- Your trades do not affect market prices as they would in live trading
- You might receive more favorable fills than in a live trading environment
- Data and Pricing
- Real-time market data and pricing may not be precisely replicated, especially for certain products or during volatile market conditions
- Some paper trading accounts may use delayed market data
- Order Execution
- Certain order types may behave differently than in live trading
- Limited support for some order types (e.g., Passive Relative, Auction, RFQ, Pegged to Market, Market with Protection for CME futures)
- Simulated fills from the top of the book only, without deep book access
- Limited combo trading capabilities
- Different behavior for stops and complex order types
- No support for penny trading in US Options
- Potential rejection of partially executed exchange-directed market orders
- Product Limitations
- Differences in products offered compared to live accounts
- No support for mutual fund trading
- Limited access to Client Portal functions.
- System Configuration
- Potential variations in system configuration compared to live accounts
- Default settings may restrict orders to Regular Trading Hours (RTH)
- Option Processing
- Differences in option exercise and expiration processing
Important Considerations
- Paper trading accounts are primarily designed for educational purposes and strategy testing, not for exact replication of live trading conditions.
- The paper trading experience should be treated as a general guide rather than an exact representation of live trading.
By understanding these aspects of paper trading accounts, you can make the most of this valuable tool for practicing and refining your trading strategies without financial risk.
Troubleshooting
If you see the message 'The specific user has multiple Paper Trading users associated with it. Please log on using one of the Paper Trading users and corresponding passwords', ensure you are logging in with your unique paper trading username and password, not your live account credentials.
Your paper trading username can be found using your live username in the Client Portal:
- Log in to Client Portal
- Click the User menu (head and shoulders icon in the top right corner) followed by Settings.
- Under the Account Configuration section select Paper Trading Account (steps 1–5 above).
Additional Information