Earlier this year, public interest in stock trading skyrocketed as the GameStop short squeeze took over online discussion. It demonstrated the potential for gaining financial independence quickly through a strong understanding of stock market fundamentals. But, perhaps even more importantly, it proved that anyone could win if they made the right calls and not just big financial institutions and hedge funds.
Successful trading effectively takes money, skill, and experience. Fantasy stocks provide all three in a safe environment without the risk and stress of a real investment. This makes them a valuable and fun stepping stone toward earning additional income streams.
Develop Stock Market Knowledge
Fantasy finance games like Invstr, Pick5 Stock Challenge or StockBattle provide a safe and fun environment to develop and test your market knowledge. By simplifying the process down to betting as little as a few dollars on the growth of a team of stocks, you can practice predicting the markets while only risking pocket change.
Source: StockBattle games: freeroll screen
Thanks to the short game time of 15 minutes to an hour, you don’t need to worry about stocks going south while you’re busy at work and unable to respond. With StockBattle, you don’t even need to spend any of your own money to try a few games thanks to daily Freerolls.
Gain Experience
The knowledge to understand and start predicting the market is one thing. However, the calm and willpower needed to trade based on that knowledge instead of following trends is another thing entirely.
Giving in to panic is a common way new traders end up buying high and selling low. Many new traders make the mistake of waiting for a rise to prove itself, only to buy after the movement is over. They also tend to sell at the worst time through hesitation and risk aversion.
Going through the many daily wins and losses of fantasy stock games can give you the real-world experience of seeing a game through to its conclusion while your bet is on the line. In addition, this can help prepare you for the psychological test of sticking to your guns on the market without the stress and worry of an actual investment hanging over you.
Test Your Research Skills
While fantasy stock games are a great way to build a more in-depth understanding of the stocks and currencies you already love, since it is a low risk, it can also motivate you to find lesser-known stocks and assess their potential. By simplifying the process of analyzing stocks down to choosing a team of stocks you think will see the most significant rise throughout the game’s duration, players are encouraged to consider a broader range of stocks to add to their team. This won’t just give you a competitive edge within the game but develops a vital skill that you will need to make your own stock decisions instead of following trends. Accordingly, you will get the best practice from playing a game that uses real-time market data rather than historical data. This means you can make your decisions based on live news and updates, just like you would with an investment.
Learn to Build a Rounded Portfolio
Fantasy stock games focus on picking a team of stocks that will potentially demonstrate the most overall growth in stock price across all of the user’s picks. As a result, they develop not just skills in identifying individual stocks with potential but in creating a portfolio that gives users the best chance of reliable profit. This is a large part of the skill and strategy involved in winning a game. For example, do you pick a team of highly volatile stocks for a risky but potentially high-scoring team? Or do you throw in a few stocks with slower but more consistent growth for a safer team that a riskier team composition might beat.
Source: Invstr app
They usually also provide social features such as in-app text and voice chat with other players in a game and online communities like Discord. Chatting also serves as a learning opportunity as users discuss and debate the best stocks to pick for upcoming contests. It is also a fun way to meet like-minded players.
Learn Crypto Markets
Besides stocks, some fantasy finance games, such as Wealthbase, allow you to trade forex and crypto. That last one is crucial. Despite the boom in popularity, cryptocurrency markets are still in their infancy. As a result, now is a great time to practice reading and making money from crypto exchange markets. As the prominence of cryptocurrency grows as a method of attaining financial independence, understanding how to trade crypto effectively will be a vital skill for anyone with interest in financial markets.
Source: StockBattle crypto games
In addition, fantasy stock games provide a way to dabble in the short-lived and unpredictable ‘meme coins’ without taking on the risk of making a real investment. So if you want to play around with these cryptocurrencies while they remain popular, this is a much smarter way to go about it than investing for the sake of experimenting.
Improve Quick Decision-Making
The longest fantasy stock games take an hour, but you can play games that are as short as 15 minutes. These quick games leave no room for hesitation, testing, and improving your ability to make the right decisions under pressure. This is an invaluable skill for learning to make money through short-term investing and day trading.
It is also a valuable talent that carries over into life in general. You would be surprised how much more efficient you can be when you practice this skill regularly. For example, in a study of 500 millionaires, Napoleon Hill identified that one of the few traits they all had in common was the ability and habit of making decisions quickly.
Build Capital For Investment
Fantasy stocks are games of skill for cash prizes, not long-term investments. However, if you hone your skills, they can be a great way to build up the extra cash you need to start trading for real. Contest prize pools can exceed $500 for games that take an hour or less, and you can even take part in multiple games simultaneously.
Source: Pick5 fantasy stock challenge
Depending on what you intend to trade, you can start day trading effectively with $5,000 up to $30,000. With a skilled approach to fantasy finance, you could generate this in a matter of weeks or even days.
Conclusion
Fantasy stock games can be much more than just a bit of fun, providing valuable practice and experience in following stocks and cryptocurrencies with no barrier to entry. Besides the wide range of skills you can develop by playing a fantasy finance game, they also present a real opportunity to build the capital you need to progress toward earning a steady additional income.
