The Basics : The California Stock Market Simulation
This is an elaborate, web-based educational tool. Each user account receives an amount of virtual dollars in a virtual brokerage account and simulates managing a portfolio by buying and selling stocks at real-time prices. For the specific amount, please refer to the "Accounts Balances" page.
Please visit the Home Page of the The California Stock Market Simulation for the current trading dates.
From the Home page, click on the "Forgot password?" link and enter your email address. Your password will be emailed to this address provided it is the same email address you used during the initial registration.
Log into your account and select the "Change Password" option under the "About" tab. Enter your old password, enter your new password, confirm the new password and click on the submit button and your password is now changed. Also note that the username and password are case sensitive.
Unfortunately you cannot change your user name.
Stock Market Basics
Companies initially raise money by selling their stock. A share of stock represents fractional ownership of a business. When you buy shares of stock in a company, you are buying a small fraction of the business and all the profits that go along with it. For example, if ABC Company needed to raise $1,000,000 they could sell 100,000 shares at $10. Each share that you owned would represent 1/100,000th ownership of the company.
Keep in mind that some companies are "public" and some companies are "private". Private companies are smaller companies that have raised money through a small number of investors and their stock does not have an active market where it can be bought and sold. Public companies have sold their stock to many investors (shareholders) and have registered their shares with the Securities and Exchange Commission and with an exchange (ex. NYSE, AMEX, or NASDAQ) and hence their shares can be bought and sold with ease on an exchange.
The two main types of shares are common and preferred stocks. Common stock gives the owner the right to vote at shareholder meetings and receive dividends if any are declared. While preferred shares typically don't confer voting rights, they have priority over common shares for earnings and assets. This means when a company declares dividends, preferred shareholders are paid before common ones and have a higher claim to assets if the company goes bankrupt and is liquidated.
When you buy stocks on The California Stock Market Simulation, they are almost always shares of common stock.
A wise investor will always conduct some type of analysis before making an investment-- acting on hot tips or blindly following the crowd rarely pays off. You can start off by watching the spending habits of your friends and family. What are they buying? Are they buying more than they used to buy? What products do you always use and trust, and which ones don’t you use anymore? Start watching the business channels on TV, and start reading a few of the popular stock market websites like finance.yahoo.com, forbes.com, investors.com, fool.com.
There is also a Research link on the The California Stock Market Simulation website that will contain many valuable links.
Everyone has heard the old adage "Buy low and sell high." When a trader buys a stock, he is said to have a "long" position. He is "long" because he believes the stock price is going higher. This is also known as being "Bullish" or a ‘Bull" on the market.
Conversely, a trader can also make money when he thinks a stock is going to decrease in price. Instead of buying low and selling high, a trader can "Sell high and buy low." In this instance, a broker will actually loan the trader shares of stock that the trader then sells. At this point, the trader has "sold short" the stock and believes the price is going to be lower. This is also known as being "Bearish" or a ‘Bear" on the market. When the price has fallen, the trader buys the stock at a lower price and "covers" his "short" position. The trader then takes the shares that he just bought and returns them to the broker from whom he borrowed the shares.
The stock exchanges provide the valuable service of bringing together all of the buyers and the sellers of stocks each day and matching the buyers and sellers that agree on a price. The exchanges keep track of all of the open orders and show the highest buy order price as the "bid price" and show the lowest sell order price as the "ask price." The "ask" is the price the person who owns the stock is asking to sell his shares.
On The California Stock Market Simulation your buy orders will get filled with the ask price and your sell orders will get filled at the bid price.
An investment portfolio is a collection of investment assets, such as stocks, bonds, ETF's, mutual funds, derivatives, real estate and commodities. Investment portfolios should be constructed after carefully assessing the investor's goals, objectives and portfolio, such as age, growth and income requirements, risk tolerance and liquidity needs. At The California Stock Market Simulation your investment portfolio is comprised of stocks in companies that are publicly traded in the U.S. markets. To verify if this simulation includes other security types, hold your mouse over the "Make a Trade" tab and see what other options are below the "Trade Stocks" link. Each security type will have a separate trading page.
A market order is an order to buy or sell a specified number of shares (or bonds, etc. ) at the best available price when the order is submitted. All orders that don't bear a specific price are considered market orders.
Market orders placed while the markets are closed or before the market opens will be executed at an appropriate bid/ask price shortly after the market opens and contingent to trading volume on that particular stock. If the stock requested does not have sufficient volume to execute, then that order will stay pending until filled or canceled.
A limit order is an order in which a specific price is set to buy or sell a security. If the price point is hit and there is sufficient volume at that price point or better, your order will be filled. Limit orders may be placed as "Day" orders which are good for the day only, or as "GTC" orders, which are good until canceled.
A stop order is an order to buy or sell a stock when the stock price reaches a specified price, which is known as a stop price. When the specified price is reached, the stop order becomes a market order.
- (a) A Sell Stop Order is used by investors and traders long a stock to protect an existing profit or avoid further losses if the stock price drops. A stop order to sell must be placed below the current market price.
- (b) A Buy Stop Order is used by investors and traders short a stock to protect a profit or limit a loss if the stock price increases. A stop order to buy must be entered at a price above the current market price.
Stop orders may be placed as "Day" orders which are good for the day only, or as "GTC" orders, which are good until canceled.
For example, if you own 100 shares of IBM at $100/share and you want to sell it if the stocks goes up to $110, that would be a limit sell order; but, if you wanted to sell if the stock price drops to $95 so as to limit your losses, that would be a stop sell order.
A market order that was placed when the market was closed and has not filled yet, or a limit/stop order that has been placed but the price has not been met yet and therefore has not executed yet is called an open order. At the The California Stock Market Simulation, all orders are either market orders or GTC orders.
In many of our stock market simulations, accounts are margin accounts, which mean that we will loan you a certain amount of funds. In these cases, the buying power calculation is the amount of stock purchases that you can make if you want to become fully invested and take the full amount of available loans. For simulations that do not permit buying on margin, than buying power equals the amount of available cash in your account. To see if this simulation permits buying on margin, just check under the "Contest Parameters" on the Account Balance Page.
The North-American stock markets open at 9:30AM ET and close at 4:00PM ET. Any trade made when markets are closed will be processed the next business day.
Markets are CLOSED for these Federal Holidays in the U.S.: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. On the day following Thanksgiving and frequently the day before Christmas, the market will close at 1:00 pm ET.
Yes! You can make a trade after the market has closed. Your trade will be filled at the open price of the stock at market open.
Trading on The California Stock Market Simulation
The California Stock Market Simulation game offers a wide variety of over 7,000 stocks. In order to be considered, securities must meet specific criteria including pricing, market capitalization and average daily volume. In addition, the security must also be traded on a recognized U.S. marketplace system such as NYSE, AMEX and NASDAQ. As long as the stock is over the minimum price per share you can buy it. To see what the minimum price per share is, check the Contest Parameters on the Account Balance Page.
To see what security types you can purchase, log in and hold your mouse over the "Make a Trade" tab.
To make a trade go to the "Make a Trade" tab, and select the appropriate security type (in some simulations "Trade Stocks" will be the only option). You must then enter a ticker symbol and the quantity of stock you would like to purchase. You then choose to buy, sell, cover, or short. Once you have reviewed the trade, you press the confirmation button to complete the trade. Note that not all simulations allow short selling – to verify is this simulation does, refer to the Contest Parameters on the Account Balance Page.
Market, and stop orders will be accepted. All orders are executed at the real-time bid/ask prices when placed during market hours. Due to NASDAQ, NYSE and AMEX regulations, the California Stock Market Simulation will display a delayed price estimate for 15-20 minutes. Each transaction made by a user will automatically appear in the users portfolio and transaction history.
When making trades, you need to know the ticker symbol of the securities to be traded. If you are unsure of the ticker symbol, then go to the "Symbol Lookup" page under the "Make a Trade" tab and enter the full or partial company name and then click "Search".
Under the "My Portfolio" tab, select the "Open Positions" submenu and click on it to see all your open positions.
You may only cancel Open Orders. To see your Open Orders and to cancel any of them, go to the "Make a Trade" tab and select the "Order History" submenu. Open Orders that can be canceled will be in yellow.
To confirm if this simulation permits short selling, refer to the Contest Parameters on the Account Balance Page. When short selling is permitted, short orders do not need an uptick to be filled. The minimum price you can short a stock will be displayed in the Contest Parameters on the Account Balance Page. Proceeds from a short sell are restricted and cannot be used to buy additional stocks. You can view the proceeds from shorts as ‘Short Balance’ on the Account Balance Page.
To see if this simulation permits buying on margin, refer to the Contest Parameters on the Account Balance Page. From there you can also verify the minimum price for marginable stock and the equity margin %. This means that the participant can borrow additional funds from the The California Stock Market Simulation. If the Equity Margin percentage is set at 50%, this means that up to 50% of your total portfolio value may be purchased on margin.
Once you have used up all your allowed trades you cannot obtain more trades. To see what the maximum number of trades is set at, please refer to the Contest Parameters on the Account Balance Page.
Every transaction you make (buy, sell, short or cover) is considered a transaction/trade.
Dividends and stock splits do not count as trades.
Day trading is when you are able to buy and sell the same stock on the same day. Keep in mind that such frequent trading will generate lots of commission charges and that you are limited to a certain number of trades for the Challenge. To see if Day trading is permitted for this challenge, check the Contest Parameters on the Account Balance Page.
There are several rules which may prevent your order from filling:
- 1. Your Challenge has not started yet. Please check the Account Balance Page for the exact trading dates.
- 2. Minimum Stock Price. The minimum stock price must be $x or higher (see the Account Balance Page)
- 3. Transaction Limits. You may not buy/sell stocks that would be greater than x% of your portfolio value. (for the specific limit refer to the Contest Parameters on the Account Balance Page)
- 4. Insufficient Volume. If the stock requested to trade does not have sufficient volume to execute, then the order will stay pending until filled or canceled.
- 5. No Shorting Penny Stocks. You may not short sell any stock whose value is less than $x. (for the specific limit refer to the Contest Parameters on the Account Balance Page)
- 6. No Penny Stocks on Margin. Buying stocks on margin (loan) priced less than $x is not permitted. (for the specific limit refer to the Contest Parameters on the Account Balance Page)
- 7. Insufficient Buying Power. You are out of money.
To see the status of any order, check the "Order History" page.
There are several reasons why you may not be able to see your order in the "Open Positions":
- 1. If your order requested volume greater than 50% of the available volume, then your order will remain pending until sufficient volume is available.
- 2. If you placed the order outside market hours, you order will stay open until the next market open.
- 3. Limit and Stop orders remain open until your requested price has been hit.
You must have the order confirmation number when disputing a trade. The order confirmation number can be obtained from the "Order History" page and is listed on the Trade Confirmation page after placing a trade.
If you believe an error has been made on your account, you must report it within 10 days to the Simulation Support Services team. The management of Stock-Trak has the ultimate authority to settle disputes.
In certain cases other stock exchanges may be available. To see which stock exchanges are available for this simulation click on "Trade Stocks" under the "Make a Trade" tab, and then click on the drop down arrow under the heading labeled "Exchange". If you see other exchanges under "US" then those exchanges are available. To see what the abbreviations stand for click on the "What are these Exchange Codes" link for the full legend.
No, you cannot trade halted, restricted and blocked stocks. Any trade that is confirmed after trading has been halted will be reversed.
A brokerage commission is applied to all transactions. To see what the commission per trade is for this simulation, refer to the Contest Parameters on the Account Balance Page.
Advanced Topics
Sometimes, due to a quick gap up or down, the stock may only trade at your limit price for a few seconds and then quickly bounce off of your ‘limit price’. As a result, your order will not get filled. This is normal and occurs on any trading platform, including real stock brokerages.
Please check if you have a pending order against the security. If you do, cancel the pending order and try again.
Simulation Support Services makes these changes at the beginning of every trading day as part of routine audits to ensure a fair game for all. If your portfolio doesn’t reflect this change within 24 hours, please contact the Simulation Support Services team.
Simulation Support Services makes these changes at the beginning of every trading day as part of routine audits to ensure a fair game for all. If your portfolio doesn’t reflect this change within 24 hours, please contact the Simulation Support Services team.
Restricted Funds are created when you place Limit orders that have not yet been filled. The funds are needed in the event that the limit price you specified is met and triggers the action you requested. When your limit order is filled, the Restricted Funds go away.
Restricted Funds are also created when you place a Market order after the market is closed. Funds are needed to carry out your stock orders when the market next opens.
First remember that all prices are delayed 15 minutes, for example if your trade was made at 10:45 A.M., the price you would get is the price at 10:30 A.M., if you trade at 9:40 A.M., you would get the opening price at 9:30 A.M. and your open positions will show Next Market Open.
If you still believe the price is wrong, then send a ticket to the Simulation Support Services team and indicate the symbol of the stock you’re having a problem with, the date and time of the transaction, the wrong price and the price you think you should have gotten.
Yes, usually the reason you have a security with a price of $0 is because that company has undergone some type of Corporate Action. We track these Corporate Actions on a daily basis but it is good that you let us know.
If you do not have adequate cash and/or buying power, then the number of shares will be adjusted to allow the trade to be filled as best it can.
Mutual Funds
Mutual funds are a professionally managed type of collective investment portfolio that pools money from many investors and invests it in stocks, bonds or other securities. The mutual fund is operated by a fund manager that trades the pooled money on a regular basis.
To verify if this simulation supports Mutual Funds, hold your mouse over the Make a Trade tab and see if you have the option to "Trade Mutual Funds".
No you are not doing anything wrong, but remember that there is no day trading available for Mutual Funds.
Yes you can, as long as you cancel the order prior to 4:00 PM.
No everything is fine, however; Mutual Fund prices start getting released at approximately 6:00 PM EST so be patient your order will be filled anytime between 6:30PM to 3:00AM EST. The reason behind this is because companies release their values at different times.
No. All US mutual funds are 5 letter symbols ending in X (VALBX, GARFX, ICTWX…) Symbols can not end in XX, since this would mean it is a Money Market fund which are not able to be traded on our system.
The position limit on mutual funds may be different than that for stocks. To verify this, refer to the Contest Parameters on the Account Balance Page.
Yes, you can own fractional units for mutual funds.
No, you can only buy mutual funds in long positions.