thinkorswim® paperMoney®: Stock Trading Simulator Tutorial

Hello, traders I’m Mike Obucina, senior content producer here at TD Ameritrade Now, the stock market can be intimidating, especially for new traders and investors And that’s why TD Ameritrade offers thinkorswim paperMoney, a free virtual trading platform that lets you practice buying and selling stocks without risking real money It’s also a great way to learn how to use thinkorswim, our award-winning trading platform Now, in this video, I’m going to show you some of the ins and outs of the paperMoney platform, how it differs from your live account, but also show you some key features that I think every stock trader should be familiar with when using thinkorswim So to get started, we’re going to download thinkorswim to our computer, and then I’m going to show you how to register for a paperMoney account Let’s jump in and get started To get started, navigate to TD and click Tools and Platforms On the left-hand side under Trading Tools and Platforms, click the link for thinkorswim If you’ve already opened an account with TD Ameritrade, you’re already registered for paperMoney In that case, scroll down, and on the right hand side, click the link for download thinkorswim If you haven’t opened an account with TD Ameritrade, click this link Register for paperMoney First, you’ll need to create a user ID and password, and then below fill out the requested information Once you’ve completed the form, click Submit From here, you can click the link at the top Install Think Desktop and begin the program installer To log in to thinkorswim, double-click the icon on your desktop, enter your username and password, and select paperMoney Then click Login Starting at the top of the platform, we have a connected status so our platform is connected to the internet We have Delayed Data If we click that, you’ll see all of our products have delayed 20 minute quotes Now, in order to get live quotes on your paperMoney platform, you must have a live, funded account with TD Ameritrade Otherwise, you will have delayed 20-minute quotes We have our Date and Time, and then we have our Account Selector If you click that, you’ll notice that you have two accounts within your paperMoney account– one, a practice margin account, and the second a practice IRA account To select which account you want to work in, just select the account, and your account info will adjust accordingly With each paperMoney account, you get $100,000 of paperMoney to work with One field I like to add to the account info section is stock buying power And you can do that by clicking the Action menu and Customize Gadget And in the lookup, we’re going to type the word Stock, and you’ll see the field Stock Buying Power We’re going to click that, add item, and hit OK And the reason I did that is now you can see in the margin account we have that red T 2 to 1 margin with our buying power So we’ve $100,000 of cash in the paperMoney account, which means we get $200,000 in stock buying power Now, how can we adjust our cash balances? Simple From our Monitor tab, Activity and Position sub-tab, there’s a button over here that says Adjust Account Click that In the Set Account Cash To field, we’re going to click the dropdown You can select from a predetermined amount Now, if we want to put in a specific cash amount, we’re going to put our mouse in this field, and we’re going to delete that And let’s say we wanted to start with $10,000 I’m going to hit Enter on my keyboard and hit Apply And now you can see we have a $10,000 starting balance Let’s start customizing our platform so we can get ready to trade stock For step one, I think every trader needs to have a good watch list in their left-hand sidebar And now to do that, we’re going to go over here in the bottom left and click the gear wheel Let’s get rid of these three– we’ll get rid of live news, Trader TV, and quick chart And now we’re just left with a watchlist gadget I’m going to take this dividing line, stretch it down so it encompasses the entire left-hand sidebar, and let’s load the Dow Jones Industrial Average watchlist To do that, you’re going to click on Select Watchlist in the dropdown And under public 2 through F, we’re going to select Dow Jones Industrial Average To start looking up a stock and trading it, you’re going to go to the Trade tab And below, you’re going to go to the All Products sub-tab And you’ll type in a symbol So for example, let’s say we wanted to trade Apple– type AAPL Or if you don’t know the symbol of a stock, you can simply type the name– and you’ll notice anything with the word Apple starts showing up, and there’s AAPL– so you can click on that as well Now, one cool tip and trick and a teacher right here is let’s link the watchlist to this symbol look-up in our Trade tab You see right now we have a linking of number one here and a number two I’m going to switch this linking, which is a symbol link feature, and I’m going to change this to red number one Now, what did that do? Well, instead of typing in symbols to our trade tab, I can now start clicking on my watchlist And you can see as I start navigating through these different stocks, my trade tab is updating so I don’t have to change or type a symbol in one at a time I can go straight from my watchlist So that’s a very cool feature Now, let’s start with Apple I’m going to click on Apple Now, in thinkorswim, there’s no buy or sell button per se,

but anywhere you see the ask price or bid price, this is where you can start to create an order to buy or sell shares of stock If you’re looking to buy stock, you will look at the ask price If you’re looking to sell stock, you would look at the bid price Now, if I click on that ask price, you’ll see an order populates at the bottom of my screen in the order entry tools Now, let’s close our sidebar by clicking this arrow OK, starting from left to right, we’re buying stock And by default, it’s set to 100 shares If you want to change the share amount manually, you can do that by clicking the plus or minus button This will change this in 100-share increments Or we can type in a specific amount Let’s say we want to buy 10 shares of Apple Type that in, hit Enter on your keyboard– all different ways that you can change the quantity here in the order ticket Now, moving over to the right, let’s look at price and our order type If you’re doing a loan order, you need to set a price, and you can do that one of two ways We can click the Plus or Minus button just like we did in the share amount, we can change this a penny at a time, or we can type a specific price in Maybe we want to buy shares if they drop to 283 even You can type that in, hit Enter on your keyboard, and we have a limit order set for the day And TIF stands for Time in Force So what this means is that this order would work for this trading day only And if we didn’t get a fill at 283, the order would cancel at the end of the day, and you would need to put that order back in tomorrow However, if you wanted this order to work longer than the current trading day, we can change this from day to good till cancel And that will make sure that this order works until either we get a fill at 283 or we cancel the order ourselves And finally, to submit the order, we’re going to hit Confirm and Send And this is the order confirmation dialog and this is your last chance to review and confirm what you’re buying, how you’re buying it, at what price And so once we’re happy with all of the order details, we’ll hit Send OK, so let’s place a market order to buy shares of stock This time we’re going to use Microsoft, and that will cue up Microsoft into my trade page We’re going to do the same thing Click the ask price, and we’re going to close our sidebar there And now instead of creating a limit order, we’re going to change this to market And notice that when we do that, the price field has disappeared So we don’t actually put in a price on a market order, and then we’ll do the same thing– hit Confirm and Send and send it off And notice we have a fill report in the upper left-hand corner of our screen Now, where can we monitor these positions once we’ve placed these trades? Well, that’s where we go to the Monitor tab And under Activity and Positions, we have today’s trade activity And here, you can get a report on any current working orders you have, your filled orders, and any canceled orders for the current trading day Now, for our example, we have two filled orders So the Apple order that we put in a few seconds ago got filled at 282.30 And then our Microsoft position, which we just sent as a market order, got filled at 172.03 Now, how can we monitor these positions? Well, I’m going to close the fill orders section, and you can see down below in our position statement both of our positions We have the quantity comm 100 shares, the trade price, and then two columns that are important– PL Open and P&L Day OK, I’ve gone ahead and I’ve added a few more positions to the account Now, let’s show you how to close a position To start, I’m going to right click on my position and hover over Create Closing Order and select Sell 100 Apple at a Limit Price Now here, we are once again selling shares of Apple if the price goes up and we want to take potential profit So to do that, I’m going to change the price Let’s imagine we want to get out of this position if Apple trades up to 290 I’m going to type that in, hit Enter We’re going to do this as a limit order And once again, I’m going to change this to Good Till Cancel, hit Confirm and Send, Send, go to the Monitor tab, and now you can see we have a working order to sell our shares of Apple Now, what if we wanted to do a stop order? Well, let’s use this Boeing position that I’ve created And we’re going to open that Same thing– right click, Create Closing Order– this time, I’m going to select with stop And now in this scenario, we’d be looking to sell shares of Boeing if the price fell and we were trying to cut our losses And to do that, we’re going to use a standard stop market order So for example, let’s imagine we want to sell these shares if Boeing falls down to $125 And I’m going to type that in, hit Enter on my keyboard We’re doing this as a standard stop order And we’re going to once again change this to good till cancel, hit confirm and send, send that off, and go back to our monitor tab– now we have two working orders, and there’s our Boeing order, our sell stop order at 125 OK, what if you wanted to adjust the position? Now, that may sound weird, but remember– we’re in simulated trading You can simulate essentially what you want And to do that, we’re going to go to this Nike position, and we’re going to right click on the position just as we did before

This time, instead of hovering over Creating Closing Order, you’re going to go down to Adjust Position Now, why would you want to do this? Well, maybe you’re practicing something or simulating something and you made a mistake and you don’t want to reset the entire account Well, let’s say we want to get rid of this Nike position What we can do is, all right, we traded this at 84.66 Say we just wanted to wipe it out Well, we’re going to put in the price– 84.66 And we’re going to put the quantity as minus-100 And hit OK And now that position has been wiped off from our monitor tab, our cash has been returned to our account So this is a way you can adjust the position without closing it Maybe you’re simulating something you just made a mistake and you just want to get rid of that OK, let’s show you a few ways that you can customize your platform as a stock trader Now, the first I’m going to is load a symbol into my look-up I’m going to click on Boeing from our watch list And next, I’m going to close my sidebar Now, below the underlying section is an area called trade grid Let’s open that up And by default, you’re going to see three empty boxes Now, these are what we call gadgets in thinkorswim, and you can customize which gadget you put in here based on what you feel is important to you as a trader Now, one thing that I think every stock trader should keep an eye on is the news So click this little action menu and hover your mouse over Gadget and Select Live News The next thing I’m going to do is I’m going to link our look-ups here with the same number And there– we now have a live news feed for anything associated with Boeing stock And if we want to click on a story, that window will appear on our screen, and now we can read that story in detail and close that up The second gadget I’m going to add is the Dashboard And what is the Dashboard? Well, let’s take a look Hover that, we’re going to select Dashboard, and I’m going to link this as well And there, we have Buy and Sell buttons So remember I said earlier in the video there aren’t Buy and Sell buttons in thinkorswim Well, if that’s what you prefer to see, the dashboard can give you that option And now to quickly queue up in order, we can click Buy, and there’s our order cued up at the bottom of our screen The other thing you can do is you can change your default quantity by clicking the quantity And let’s say we wanted to only trade 10 shares at any given time Well, now we have a quantity of 10, so when I hit Buy, there we go, 10 shares So another cool feature here in the trade grid And the last thing maybe for more of an advanced trader is we’re going to add level two quotes, which is going to show the depth of market for this particular stock Hover over Gadget, Select Level 2, and then link our box And there you go– we have Level 2 quotes for Boeing Now, once again, because everything is now linked as we go through our watchlist, all of these gadgets are going to change as we move through our watchlist so we can get a quick look at the news, have a Buy Sell button, as well as the depth of market for that particular stock The next feature I’d like to show you is our Charts tab And if you click on the Charts tab at the top and the Charts sub-tab, the first thing I’m going to do is link my symbol look-up, as we’ve been doing this entire video And now our watchlist is linked to the Charts feature So as I scroll through this, my charts will update with each symbol I’m selecting Let’s take a look at this Home Depot chart, for example Now, by default, thinkorswim will put you on a one year, one day chart, which you can see here in the upper left-hand corner So one year of data, and each candle represents one day of trading activity When you highlight your mouse over a specific candle, you see up here at the top that the data for that candle updates and you’ll see the opening, high, low, close, as well as the range for that candle Now, what are some of the elements we see on the chart? Well, at the bottom, we have any earnings announcements and earnings calls information So we can go back for the last four quarters on this chart and look at different earnings information for Home Depot The dollar sign represents any dividends paid on this stock and when they were paid Below, we have our volume subgraph, and this will be by default. You can adjust this in the settings And then also too, the red dashed line stands for the options expiration of Home Depot And then the gray dotted line represents the year marker, so we went from 2019 to 2020 Highlighted on the chart will be the high and low closing prices for the period you’re in And then on the right-hand side will be the current price of the stock in relationship to the y-axis of the chart And what if you want to add a quick study to this chart? Very simple– you’re going to go to the beaker here at the top of the menu, and we’re going to add a study Let’s say, for example, we wanted to add a simple moving average You can see I typed the word Simple, Moving Average shows up We’re going to Add Selected Now, in this particular study, each number here represents the period So if we wanted to, for example, look at a 200-day moving average, we can click the gear wheel, change from a nine-day moving average to 200, and then hit OK, and then hit Apply And then now you see we have a 200-day moving average added to our chart And what if you want to change the time frame– you don’t want to see a year chart, you want to look closer at an intraday chart?

Simple We’re going to click on the time frame setup, and you can choose from predetermined time frames or you can make your own under the time frame tab Let’s do an intraday chart, and we’re in changes to five days, five minutes Hit Apply, and there we go Now, as a stock trader, can you trade from the charts? Absolutely If you right click anywhere on the chart, you can then create a buy order And it’s going to create the price based on where you clicked on the chart So it’s important if you’re going to use this to be precise And you may have to go in and edit your order by clicking the Edit, which will create your order entry tool Now, the other cool thing is it will keep track of your orders Now, remember, we have some working orders in the account Let’s look at our working order for Apple And I’m going to go back to our chart, open our watchlist and click on Apple And you can see on our chart, there’s our limit order to sell our 100 shares of stock And you can see we placed it at $290 The stock is just below that, so if it keeps going up, this order will get filled Now, we can move this order on the chart simply by clicking this and dragging it to our desired new price And let’s say we wanted to move this down to $288 And we got pretty close there, so let’s leave that there And now we have an order cued up, we can leave this at the $288.06 that we dragged the price to, or we can go in and edit this more precisely and hit Confirm and Send And now what we’ve done is we’ve canceled our limit order, and we’ve replaced it with a new working order to sell these shares at $288 One more feature I’d like to show you is the Scan tab And this is a feature that’ll allow you to find essentially a needle in a haystack based on criteria you create So first, I’m going to show you a very simple scan And we’re under our Scan tab Stock Hacker sub-tab The first thing I’m going to do is I’m going to scan for stocks in the S&P 500 So I’m going to this dropdown, and I’m selecting the S&P 500 The first thing I’m going to do, you see we have three criteria by default that we can look for I’m going to delete two of these and just start with one criteria Let’s look for stocks that have a volume of one million shares traded or more I’m going to hit Enter on my keyboard You can see that’s narrowed the field down We’ve got about 180 stocks in the S&P 500 that have traded a million or more shares today Now, that’s still a pretty big field Let’s narrow it down even more I’m going to add a second filter You can see here at the top we have Add Filter And let’s do a fundamental filter And what I’m going to look for is dividend yield So there’s dividend yield, and I want to find stocks– current dividend yield with a dividend yield of 6% or more Hit Enter, and hit scan And now you can see we’ve narrowed this down to essentially 1, 2, 3, 4, 5, 6, 7, 8 stocks within the S&P 500 that have traded a volume of a million shares or more and if a current dividend yield of 6% OK, the last two things I want to show you in this video is how do you add more cash to the account? And the second thing I want to show you is how to reset, start from scratch So maybe we want to add $5,000 to this That may simulate you sending a transfer into your account Well, on any of your positions, just right click, and you can see this selection– Adjust Cash And here we can add Let’s add $5,000 to our account Hit Enter, and you’ll see the description will come up as a cash adjustment Hit OK And now our balance is up $5,000 Finally, how do you reset the account? You want to start from scratch– very simple We’re going to go back to that handy Adjust Account button, and we’re going to click this Reset All Balances and Positions When we hit Apply, we get a warning message reminding you, this is going to clear everything out If you’re ready to do that, click Yes And now you see all of our working orders in the account have canceled, all of our positions have zeroed out, and our cash has been reset to that $100,000 that we started with at the beginning of the video Now, one final note– the position and Order History that you see here on the Monitor tab, this will clean out overnight, and when you log in tomorrow, your monitor tab will be clean and have nothing on the position statement or today’s trade activity Now, don’t forget, paperMoney is a simulation, and it will vary in some respects to trading in a live account So while it’s great to practice with paperMoney, it’s best not to rely on it as a gauge of future profitability or potential success of a given trading strategy So now remember, to get started with paperMoney, head over to, try it out free for 60 days For more great investor education, check out all the content on our YouTube channel And for more in-depth tutorials and walkthroughs of the thinkorswim trading platform, head over to the thinkorswim learning center at