Paper trading: testing a bot without money

What it is

In paper mode a bot gets real prices from the exchange and makes the same decisions as on a real account: where to buy, where to sell, when to wait. One thing differs — orders do not go to the exchange, they fill in a simulation. No API key is needed and nothing is at risk.

In Nexora a paper bot runs on the same engine as a real one: only the last link, the one that sends the order, is different. So a paper run shows the behaviour of the very bot you will switch on later.

What to check on paper

• How often the bot trades on the pair you chose — and whether it trades at all.
• How much money is tied up once the price has gone down several rungs.
• How much of the result goes to fees.
• Whether you understand why the bot bought, or did not, at a given moment.

How paper differs from the exchange

The simulation is strict on purpose. An order counts as filled only once the market has gone through its price, not merely touched it. A market buy walks the real order book and pays slippage. A fee is charged on every trade. It is still a model: a real order takes its own place in the book and a simulated one does not, so on an illiquid pair the exchange’s result can differ.

The second difference is you. Watching a drawdown in pretend money is easy. With real money it feels different, and it is better met with a small amount.

How long to run on paper

Long enough to see both a rise and a fall. A few days in a calm market only show that the bot can buy and sell. The interesting day is the one when the price goes down: that is when you see how much money is tied up and whether you can sit through it.

What next

• Run the same settings through a backtest on history — over several different periods.
• To trade on the exchange, turn on two-factor authentication and connect an API key without withdrawal.
• Start with a small amount and the settings you have already watched on paper.