Getting Started with Paper Trading
Paper trading runs your strategies against live market prices from real exchanges, with virtual capital. All the market mechanics of live trading — fills, slippage, commissions — with zero financial risk.
Cosa Imparerai
- ▸What paper trading is and why it matters before going live
- ▸How to create a simulation account with the right settings
- ▸How to deploy a strategy and configure capital allocation
- ▸What happens when you start a strategy and how to monitor it
- ▸What to do when you stop a strategy that has open positions
What is paper trading#
Paper trading simulates real order execution using live prices from Binance or Hyperliquid, but settles trades against a virtual balance. Your strategies fire signals, the platform fills orders at real market prices with realistic commissions (0.04%), and your account balance updates accordingly — the only difference is that no real money moves.
Why paper trade#
Real market conditions
Backtests use historical data. Paper trading uses live prices, live volatility, and current market structure. It reveals how your strategy actually performs in the market as it exists today.
Catch implementation issues
Problems invisible in backtests surface here: data timing edges, feature calculation edge cases, or logic that behaves unexpectedly when conditions arrive in rapid succession.
Build confidence
Watching a strategy run for weeks before committing real capital builds the psychological conviction needed to hold through drawdowns in live trading.
Risk-free learning
Make mistakes, learn from them, and refine your approach. The platform is designed to let you fail cheaply in simulation so you succeed in production.
Step 1: Create a simulation account#
Simulation accounts hold your virtual capital and host deployed strategies. Each account is independent — separate balance, separate history.
Account form fields
How to create
- Navigate to **Strategy Simulation** in the sidebar
- Click **Create Simulation Account**
- Fill out the account form
- Click **Create Account** — the account appears immediately in your list
Form fields
- **Account Name** — a label for your own reference (e.g., 'BTC Mean Reversion', 'Conservative Test')
- **Description** — optional notes about this account's purpose or strategy type
- **Initial Balance** — starting virtual capital in your chosen currency
- **Currency** — USD (default)
- **Exchange** — Binance or Hyperliquid. The exchange determines which assets and price feeds are available for deployed strategies.
- **Leverage** — multiplier for your capital (range: 1–100, default: 1). Keep at 1 for spot trading. Leverage above 1 amplifies both gains and losses and is appropriate only for testing leveraged strategies.
Pro Tip: Create separate accounts for different risk profiles or strategy types: one for conservative trend-following strategies, another for aggressive mean-reversion testing. Each account's history stays clean and comparable.
Step 2: Deploy a strategy#
Deployment attaches a saved strategy to an account. A deployed strategy is in **Stopped** state by default — it won't execute until you start it.
Steps
- Open an account from your simulation dashboard
- Click **Add Strategy**
- Select a strategy from your saved library
- Configure deployment settings
- Click **Deploy**
Deployment settings
- **Deployment Name** — a custom label for this specific deployment (e.g., 'RSI-14 BTC 1h')
- **Capital Allocation** — the amount of account balance dedicated to this strategy. Example: $4,000 from a $10,000 account.
- **Symbol** — the trading pair (e.g., BTCUSDT, ETHUSDT)
- **Timeframe** — the candle interval the strategy runs on (e.g., 1h, 4h)
Important: You can deploy multiple strategies to one account. Each gets its own capital slice. The sum of all allocations cannot exceed the current account balance.
Step 3: Start the strategy#
Deployed strategies do not execute automatically. You start them explicitly.
- Find the deployed strategy in the account's strategy list
- Click **Start**
- Status changes from **Stopped** to **Running**
- The strategy begins receiving live market data and evaluates your logic at each candle close
- When conditions are met, orders execute automatically and the account balance updates
Step 4: Monitor performance#
Once running, track the strategy from the simulation dashboard and the per-strategy detail view.
Simulation dashboard
The top-level simulation page shows all accounts at a glance with total virtual P&L, active strategy count, and live account equity values.
Per-strategy detail
Each deployed strategy has a detail view with the live trading chart (togglable between OHLCV and equity curve), an open position card when a position is active, and the full order history table.
For a complete monitoring guide, see the Monitoring Strategies page.
Stopping a strategy#
Click **Stop** on the strategy card at any time. Status returns to **Stopped** and market data subscription ends.
Open positions are **not closed automatically** when you stop a strategy. Any open position remains open and unmanaged until you restart the strategy (and let it exit naturally) or the position is handled through another action.
Warning: Stopping a strategy with an open position means that position is no longer managed. Factor this in before stopping during volatile market conditions.
Best practices#
Match your intended live capital
If you plan to trade with $5,000 live, use $5,000 in paper trading. Practicing with $100,000 virtual capital gives you false confidence about real-money psychology.
Run long enough
Paper trade for at least 2–4 weeks, ideally 2–3 months. Different market conditions reveal different failure modes. A week of paper trading proves almost nothing.
Compare to your backtest
Paper trading performance should roughly match backtest results over comparable periods. Large divergences (above 20%) indicate over-fitting, data differences, or a changed market regime.
Check daily
Review strategy status and recent trades once a day. Catch errors early. Don't check hourly — it leads to impulsive parameter changes based on noise.
Don't over-tweak
If performance is disappointing, resist the urge to adjust parameters daily. Analyze what's happening, make one considered change, let it run for another week, then evaluate.
Common issues#
Strategy shows Error status
Possible cause: Invalid strategy definition, feature unavailable, or a connectivity problem.
Solution: Check that the strategy passes validation in the editor. Verify the features referenced in your DataSource node exist and have been materialized. Restart the strategy. If the error persists, re-run the backtest to confirm the strategy is valid.
No trades executing
Possible cause: Entry conditions simply haven't been met yet — or current market conditions are different from the backtest period.
Solution: This is often normal. Strategies wait for the right conditions. Check that the strategy is in Running status, then wait at least a few days before concluding something is wrong.
Performance much worse than backtest
Possible cause: Over-fitted backtest (curve fitting), a changed market regime, or a look-ahead bias in the backtest setup.
Solution: Stop the strategy. Compare paper trades to backtest trades on the same dates. Re-test on more diverse historical periods. Consider that the strategy logic may need rethinking before live deployment.