> For the complete documentation index, see [llms.txt](https://guida-2.gitbook.io/guida-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://guida-2.gitbook.io/guida-docs/core-concepts/paper-trading.md). # Paper Trading **Paper trading** means running a strategy on **live market prices** using **simulated funds**. Nothing real is at stake, but everything else is genuine — the prices, the timing, the market's behavior. It's the safest, smartest way to build confidence in a strategy before committing real capital, and it's the foundation of Guida's early-access experience. ## Why it's called "paper" trading The term is old: traders once tracked hypothetical trades on paper to test an idea without risking money. Guida does the same thing, automatically and in real time. Your strategy runs exactly as it would live — it just books simulated gains and losses instead of real ones. ## What paper trading proves that backtesting can't [Backtesting](/guida-docs/core-concepts/backtesting.md) tells you how a strategy would have done in the *past*. Paper trading tells you how it's doing *right now*, going forward. That difference matters enormously: * **Live conditions are the real test.** A backtest can't fully capture today's liquidity, volatility, and timing. Paper trading runs into all of it. * **It catches the gap between theory and reality.** If a strategy triggers at unexpected moments, or behaves differently than the backtest suggested, forward-testing on live prices reveals it — before it costs you. * **It builds *****earned***** confidence.** Watching a strategy operate sensibly on live markets, day after day, is what turns "this looks promising" into "I trust this." ## How to use paper trading well 1. **Run it long enough to matter.** A day or two tells you little. Give a strategy a meaningful stretch of live market conditions — ideally including some volatility — before judging it. 2. **Compare it to the backtest.** Do the live results roughly line up with what history predicted? Big discrepancies are a signal to dig in before going further. 3. **Watch behavior, not just profit.** Does it trigger when you expect? Does it size positions the way you intended? Does it exit cleanly? Behavior tells you more than a single P\&L number. 4. **Resist the urge to over-tinker.** Constantly changing a strategy mid-test resets the clock and muddies the results. Let it run, then adjust deliberately. ## Paper trading in early-access Guida During early access, Guida is **paper-trading first by design.** This is deliberate: it lets you learn the entire workflow — building, testing, deploying, and monitoring strategies — on live markets with zero financial risk. When live trading arrives in a later release, the strategies you've built and validated on paper are ready to graduate. > Think of paper trading as a flight simulator for your strategies. Real instruments, real conditions, real practice — without the cost of a crash. ## An honest note Paper trading removes financial risk, but it can't perfectly replicate every nuance of trading real money — including the psychological pressure of having skin in the game. It's the best possible rehearsal, not a guarantee. Treat strong paper results as strong evidence, not certainty. *** **Next:** [Risk Management →](/guida-docs/core-concepts/risk-management.md) --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://guida-2.gitbook.io/guida-docs/core-concepts/paper-trading.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.