So you've read my first two blogs on paper trading here and here, and you want to jump in with both feet and get started, here are a few resources you can use to guide you through it.

Of course, we can do what I mentioned in part I of this series, and track our trades by hand. Who wants to do that though? It's a record keeping nightmare! Aside from that, it's not very realistic in today's world because you couldn't utilize many of the technologies available to investors today (like limit orders). Here are a few web sites that can help you in your paper trading:

1) simulator.investopedia.com/: In my opinion the best free, no strings attached paper trading utility out there. You start out with $100,000 of virtual cash, and can trade any stocks in a north american exchange. It allows you to sell short, use margin, and buy/sell options. ANd if that isn't enough, you can create a group for you and your friends and hold friendly competitions to see who the best investment guru is.

The pros:

• Easy to use interface
  
• Ability to paper trade stocks and options
  
• Ability to set limit orders
  
• Actually pays dividends! (in paper money of course)
  

The cons:

• Cannot short options (not a huge deal for beginners but a limitation none-the-less)
  
• Quotes are delayed 15-20 minutes (pretty standard for free sites)
  
• Doesn't have built in tools for spreads, causing one order to trigger another, etc.
  

All in all it's a great free tool, and definitely enough to get you started.

2)OptionsXpress:
Although I'm sure many online brokers have their own paper trading systems, I'm not familiar with them because I only use OptionsXpress. I have both my Roth IRA and my wife's Roth IRA there, and will soon rollover my old 401(k) to a rollover IRA.

OptionsXpress has a paper trading feature that works much like their real trading environment. Almost anything you can do in the real world you can do in their virtual trader, albiet some things will be more difficult. You can get access to this for free, but you have to open some sort of brokerage account. You don't neccessarily have to fund your account, but I wouldn't encourage that because if too many people abuse the "no minimum balance" they'll stop offering it. If you don't have an IRA already, and you will want to actively manage it yourself, why not go over and open one? As I mentioned in this blog, you should always be saving something, even if it's a small amount.

The pros:

• System works like their real system so it's also a practice run before using their tool.
  
• Can execute virtually any trading strategy, sell short, spreads, etc.
  
• You control the paper money you have (you should probably set it to what your actual investment amount will be)
  
• factors in commissions.
  

The cons:

• Doesn't have virtual screens for advances options trading like their main site does (ex. condors)
  

I'm sure there are numerous paper trading systems available out there that I don't know about, and I'm sure you'll tell me where they are. :-)mortgage calculator