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However, most paper trading usually involves the use of a stock market simulator, which looks and feels like an actual stock market. Another benefit of a paper trade is that it can be used to test a new investment strategy before employing it in a live account.
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Investors and traders who wish to paper trade should familiarize themselves with various order types such as stop-losslimit and market orders. Also, learning through paper transactions should use multiple market conditions. Slippage occurs when a trader obtains a different rate than expected from the time the trade is initiated to the time the trade is.
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