How To Paper Trade Options On Webull

Webull is one of the top stock trading and investing platforms in the world and is a direct competitor to Robinhood. One of the biggest reasons why Webull has become so popular is that they offer a “paper trading” option to new users that allows them to simulate the experience of investing with fake money (kind of like Monopoly).

One of the biggest questions asked by beginner paper traders is, “can you paper trade options on Webull?

Unfortunately, at this time, Webull does not support paper trading for options. Options trading is a special method of contract-based trading and is generally regarded as a more advanced trading strategy. That being said, you can trade regular stocks and ETFs with Webull’s paper trading simulator.

In today’s article, I’m going to discuss some of the basics of paper trading on Webull and some of the advantages of taking time to practice trading before you start risking your own real money.

Even though you can’t paper trade options on Webull, I am going to explain how to trade stocks and ETFs using Webull’s paper trading simulator. Here is how you can get approved for options trading on Webull.

Are you ready to practice your investing skills? 

Paper Trading On Webull

In addition to quick approvals, one of the top reasons why Webull has dominated the market as a personal brokerage platform is that it’s one of the only platforms that has a fully functional paper trading platform.

Paper trading is an ages-old term that refers to the old days before digital computer trading came about. 

Inexperienced stock traders would track all of their trade values, investments, and losses on paper using an imaginary sum of money. This would give them the talent and skills that they needed before they risked their own hard-earned cash on stocks.

Modern-day paper trading essentially the same.

However, instead of having to track all of your trades with a pen and pad, you’ll be able to use Webull’s digital trading platform just like you would if you were investing real money. 

To access Webull’s paper trading platform, access the menu and click the tab that says ‘Paper Trading.’ This will lead you to a trading platform that looks identical to Webull’s regular real-money trading platform.

The only difference is that your account balance will magically have $1,000,000.00 of “play money” for you to try your hand at investing. This way, you don’t have to deal with your Buying Power being insufficient.

So, now that you’ve opened your paper trading account let’s explore what else you can do! 

View The Markets

Before you start trading, it’s a good idea to check out an overview of the market.

The stock market changes every single hour of every single day. However, within a few minutes of looking at the latest market data, it’s usually pretty easy to tell whether it’s a “good day” or a “bad day.” Of course, the difference between a good day and a bad day is relative, so the more accurate term would be “the market is up/down.” 

Just because the market is down for the day, though, isn’t necessarily a bad thing. Many of the smartest investors use down days to buy extra stocks that they are confident will rise back up in the coming days or weeks. 

Once you find some promising companies, take some time to research them, read the latest news on the company or ETF, and make sure that it shows good potential to increase in value over time. 

Invest In Stocks and ETFs

Once you have a bit of market data to base your decisions on, it’s time to start paper trading stocks and ETFs on Webull. Make sure that you’re in your paper trading account, and then search for what you want to invest in. 

You’ll have the choice to purchase whole shares or “fractional shares,” which are small portions of a share.

For instance, if you want to purchase a $100 share, but only want to buy $75 worth, then you can purchase a three-quarter share.

Webull also gives you the option to short stocks.

What’s The Difference Between a Stock and an ETF?

Stocks represent a share in a single company. For instance, you can buy stocks in tech companies like Facebook, Apple, Twitter, and own shares of those companies.

ETFs stands for Exchange Traded Funds. Essentially an ETF is a group of stocks that you can invest in. It’s an easy way to diversify your portfolio without having to purchase all of the shares separately. 

For example, you could invest in an ETF that holds equal shares of all the major tech companies. The main difference is that you won’t own any shares of the “pieces of the pie” (the individual tech companies).

However, as the “pieces of the pie” increase in value, so will your investment in the ETF. 

Can You Paper Trade Bitcoin and Cryptocurrency On Webull?

Another feature that makes Webull such a popular trading platform is that they recently opened their own cryptocurrency trading platform.

It’s similar to Coinbase or Robinhood’s crypto trading platform in overall appearance, but Webull has some nice interactive charts that help analyze a token’s performance. 

Unfortunately, though, you cannot paper trade cryptocurrency. This is partly because cryptocurrency is somewhat volatile and because crypto trading is a special privilege that is only given to qualified traders on Webull.

You can also trade after hours using Webull.

Can You Collect Dividends While Paper Trading?

Dividends are annual payouts that are given out by companies to their shareholders at the end of the year.

As long as the company made their profit margins and turned a reasonable profit, many of them give out dividends as a kind of “bonus” for trusting them with your investment money. 

Since dividends are considered a corporate bonus, though, you cannot collect dividends while paper trading (even though it’s just fake hypothetical money).

Essentially, since you’re not an actual shareholder, there’s no way to track your investment for a potential dividend in the first place.