They say that practice makes perfect but when it comes to investing, practising usually means putting your money on the line. If you want to try out investing in the sharemarket without the risk of losing any money, one option to consider is the free ASX Sharemarket Game. It can be a great way to learn about how the sharemarket works before you take the plunge for real.
How the ASX Sharemarket game works
You get $50,000 virtual cash which you can use to invest in 200+ nominated companies listed on ASX. The game also provides you with exposure to 45 ETFs and five LICs to diversify your portfolio.
You can place orders to buy or sell shares any time, however orders are only processed when the market is open and live prices will be used. You’ll be charged brokerage on each trade, simulating real sharemarket conditions. You’ll be able to monitor your shares using your portfolio dashboard and can even create a stop loss to protect the value of your portfolio.
If you want to play with friends, family or work colleagues you can create a ‘league’ and have a bit of a friendly competition.
The ASX runs two games a year. Registration for the second game of 2021 is now open. The actual game kicks off on 12 August and runs for 15 weeks until 25 November.
Prizes up for grabs
If you do really well you could possibly even win a cash prize. The person who ends up in first place will score $2,000, while those in second and third place will win $1,500 and $1,000 respectively.
There are also prizes for leagues. The group that wins the ‘minor league’ (10 people and under) will share $1,000. Larger groups of 11 or more fall into the ‘major league’ category and the group prize is $3,000.
Have a game plan
If this is your first time playing the game the ASX suggests you create a trading plan and offers these tips:
- For your first game, it may be that you simply select some of the companies you know and do some research on these companies. Then select a few that have a good balance sheet and place your trades.
- It may also help to simply buy and hold. Have a few parameters in place to decide if the stock isn’t performing as you want, you will sell and make another selection.
- Don’t put pressure on yourself the first time around, as this is a learning process. As you develop your knowledge, the strategy or plan you want to use will become clearer and you can expand and test what you have learnt next time.
It is also worth checking out the ASX’s how-to guides and video tutorials before the game kicks off.
Tips from a winner
If you want a few more tips who better to ask than a past winner? Cameron from Victoria took out first place in the second game of 2020, turning his virtual $50,000 into $79,713. It was the first time he played the game.
“My simple methodology was to select companies that had been affected by the economic impact of the coronavirus and that were sitting in a trough, but were also still solid companies and had been mostly sold out of panic by others rather than for loss of revenue,” explained Cameron.
After the first week of trading, Cameron didn’t look at his portfolio for a few months, but when he did he saw he was high up on the leaderboard. “After that, I would check periodically for a couple of minutes each day to see how my portfolio was tracking, making a few more trades in the latter parts of the game,” he told Canstar.
Cameron shared these tips for anyone playing the game:
- Don’t day trade – it is too much hassle and time-consuming. Just hold for longer periods of time.
- Look at market overreaction on overselling of stocks so you can buy at a discounted price.
- Back yourself and your own judgement when trading. If you miss out on purchasing a stock that doubles in value over a period of time, don’t stress, there will always be another opportunity coming.
- Remember, there will always be some amount of luck involved!
Cover image source: Thomas Andreas/Shutterstock.com
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If you’re comparing online share trading companies, the comparison table below displays some of the companies available on Canstar’s database with links to providers’ websites. The information displayed is based on an average of six trades per month. Please note the table is sorted by Star Rating (highest to lowest), followed by provider name (alphabetical). Use Canstar’s Online Share Trading comparison selector to view a wider range of online share trading companies.