Option market simulators
By Simon Gleadall, CEO of Volcube.
Trading simulators have always been used in the financial markets to train junior traders. Even before the markets became overwhelmingly electronic, the use of simple, offline trading games such as Liar’s Poker to teach the fundamental skills of trading was at the core of many training programmes. Financial market simulators are risk-free and above all an enjoyable way to learn!
However, most modern simulators are far from perfect. Some just offer ‘phantom’ market data upon which ‘phantom’ trades can be executed. This is limiting because the simulator is only available when the underlying market is open. And few simulators give the user much feedback on their performance or about how to improve. In fact, most simulators are just simulators; they make no attempt to actually teach the user about the financial markets.
When we built Volcube, we knew that an options market simulator would be a great tool but only if it combined the benefits of a trading simulator with smart, automated teaching. So first we built a great options market simulator that was driven entirely by algorithms and was web-based to avoid limiting access to when markets were open. Then we made sure that our options simulator was also a great learning tool. We built feedback of the user’s performance into the technology. We built the Volcube Market Mentor right in the simulation environment so the user could get advice on Volcube trading in real time as they use the simulator. We built replay and repeat facilities so that the Volcube user can go back and try trading sessions ago and learn from their mistakes. We built a scoring system so users can benchmark their own progress as Volcube option traders. And of course we added a comprehensive video and article repository comprehensively explaining derivatives and options theory as part of the application.
Any financial market simulator needs to combine realism with enjoyment. Volcube is realistic but also a lot of fun to play on. But to become a great piece of training technology, a simulator needs to go beyond these basics. We believe Volcube is such an effective training tool because it has been built from the ground up with this in mind.