Reconcile a paper trade and its limits
See this course’s project requirements
A fictional stock-literacy file with a quote card, checked order and gap cases, an accessible OHLC chart, a pattern counterexample and a reconciled paper-trade ledger.
Keep your working files in your own notebook or software. Save a private description, checklist, and work link in My Proof.
What to include
- A quote card with exact symbol, historical last price, best bid, best ask, spread, visible sizes and simulation limitations.
- An order comparison showing executed quantity, unfilled quantity, gross cost, weighted fill price, fee and total cash cost.
- A two-column gap comparison with trigger, resulting instruction, fill status, executed price, net cash and unsold shares.
- An annotated original candle chart, exact matching data table and period-3 range/body/wick calculation.
- A pattern note with numerical definitions, $49 three-period average, opposing continuations and a failed observed-support band.
- A complete fictional stock-literacy file with quote card, order/gap comparisons, accessible OHLC chart, pattern counterexample and reconciled two-order ledger.
Review and revise
Use these criteria to check your work and choose what to improve.
- Quote, order and ledger records use the exact supplied inputs, distinguish submitted/pending/filled states and reconcile all executed quantities.
- Money calculations show units, fees and intermediate steps; cash and shares agree with an independent calculation.
- The original chart has a matching table and labels; pattern notes retain contrary evidence and distinguish historical observations from forecasts.
- All six lesson outputs and changed-input results are included, with fictional assumptions and untested real-world behavior stated accurately.
Want more background?
The idea in everyday life
PINE-PRACTICE is an invented company symbol, not a real security. The fictional last-traded price is $50.00. The book has buyers for 6 shares at $50.00 and 4 at $49.80; sellers offer 6 shares at $50.20 and 4 at $50.40. Use those quotes exactly, with no other traders or changing prices. A fictional fee of $1 is charged once per order with any fill; no fee is charged when nothing fills. This static exercise omits routing, queue priority, tax, latency, price improvement, market halts and brokerage-specific rules. Start with $1,000 paper cash and zero shares. First complete the 10-share market buy from lesson 2. Then, as a separate later paper sell case with unchanged supplied bids, sell all 10 at 6 × $50.00 and 4 × $49.80. Charge one $1 fee to each of these two executed orders. All fills are supplied; the exercise does not simulate time, settlement availability or real broker cash restrictions.
An auditable paper trade connects instructions to executed quantities, fees, cash and remaining shares. A practice result is not evidence of real trading skill or future profit.
Reconcile a paper trade and its limits — worked paper practice
An auditable paper trade connects instructions to executed quantities, fees, cash and remaining shares. A practice result is not evidence of real trading skill or future profit.
PINE-PRACTICE is an invented company symbol, not a real security. The fictional last-traded price is $50.00. The book has buyers for 6 shares at $50.00 and 4 at $49.80; sellers offer 6 shares at $50.20 and 4 at $50.40. Use those quotes exactly, with no other traders or changing prices. A fictional fee of $1 is charged once per order with any fill; no fee is charged when nothing fills. This static exercise omits routing, queue priority, tax, latency, price improvement, market halts and brokerage-specific rules. Start with $1,000 paper cash and zero shares. First complete the 10-share market buy from lesson 2. Then, as a separate later paper sell case with unchanged supplied bids, sell all 10 at 6 × $50.00 and 4 × $49.80. Charge one $1 fee to each of these two executed orders. All fills are supplied; the exercise does not simulate time, settlement availability or real broker cash restrictions.
Executed paper trade records
Paste at A1.
| ARecord | BSide | CQuantity | DPrice ($/share) |
|---|---|---|---|
| B1-a | Buy | 6 | 50.2 |
| B1-b | Buy | 4 | 50.4 |
| S1-a | Sell | 6 | 50 |
| S1-b | Sell | 4 | 49.8 |
Copy as plain text
1. Reconcile the buy
Start at $1,000 cash and subtract the $503.80 complete buy cost.
You should see: $496.20 cash and 10 shares after the buy.
An order with two fills still has one modeled fee in this case.
2. Reconcile the sale
Multiply each sell quantity by its bid, add them and subtract one $1 fee.
You should see: $300 + $199.20 = $499.20 gross; $498.20 net.
Paper sellers meet the supplied bid levels, not the historical last price for all shares.
3. Check ending balances
Add $498.20 proceeds to $496.20 cash; remove 10 sold shares.
You should see: $994.40 cash and 0 shares.
Cash and position records must both reconcile.
4. Check the loss twice
Compare start with end, then total cost with net sale proceeds.
You should see: $1,000 − $994.40 = $5.60; $503.80 − $498.20 = $5.60.
Independent equivalent calculations can reveal omitted fees or wrong quantities.
5. Assemble the file
Add the quote, market/limit, gap, chart and pattern records to the ledger.
You should see: All six required records use matching inputs, definitions and limitations.
A complete evidence file matters more than a claimed return.
6. Document unknowns
Write that current real broker rules and future prices require separate verification.
You should see: No real trading, borrowing, brokerage eligibility or forecast is established.
Official rules and institution policies can change; a fictional model is deliberately bounded.
More practice and troubleshooting
Check dated current rules
For most applicable U.S. securities trades, consult the current SEC T+1 settlement bulletin, including its exceptions. Brokerage policies can differ. FINRA’s intraday-margin guidance describes a transition between systems; this course uses no borrowing and supplies no operational margin or day-trading eligibility rule. Use the official links and confirm institution-specific requirements before any real action.
What to finish
A complete fictional stock-literacy file with quote card, order/gap comparisons, accessible OHLC chart, pattern counterexample and reconciled two-order ledger.
Watch for this
Counting a submitted order as filled, ignoring fees, or describing an invented profitable result as proof a method works in real markets.
How can I tell I understand it?
Reconcile cash and shares independently, explain the $5.60 loss despite unchanged quotes and distinguish demonstrated arithmetic from untested real execution.
Quick knowledge check
Answer all 3 questions. Get at least 2 right and the lesson completes automatically.
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Answer all 3 questions above and get at least 2 right. You can review the explanations and try again.
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Sources and further reading
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Source & access notes · checked 2026-10-01
Inspected bid, ask and spread definitions; all quote sizes and prices in this course are invented.
Access: Public official page inspected with the web reader on 2026-10-01; no broker tools or real transactions operated.
Reuse: Concept references only. All prices, records, charts, worked examples, exercises and questions are original fictional LifeStarter material; no source diagram or exercise copied.
Source & access notes · checked 2026-10-01
Inspected market/limit, partial execution, stop triggers and stop-limit nonexecution; specific policies vary by broker.
Access: Public official page inspected with the web reader on 2026-10-01; no broker tools or real transactions operated.
Reuse: Concept references only. All prices, records, charts, worked examples, exercises and questions are original fictional LifeStarter material; no source diagram or exercise copied.
Source & access notes · checked 2026-10-01
Inspected historical-pattern analysis, trading costs, missed-opportunity risks and distinction from long-term investing.
Access: Public official page inspected with the web reader on 2026-10-01; no broker tools or real transactions operated.
Reuse: Concept references only. All prices, records, charts, worked examples, exercises and questions are original fictional LifeStarter material; no source diagram or exercise copied.
Source & access notes · checked 2026-10-01
Inspected risks of loss and possible difficulty liquidating positions; no copied disclosure block or claim of FINRA approval.
Access: Public official page inspected with the web reader on 2026-10-01; no broker tools or real transactions operated.
Reuse: Concept references only. All prices, records, charts, worked examples, exercises and questions are original fictional LifeStarter material; no source diagram or exercise copied.
Source & access notes · checked 2026-10-01
Inspected current one-business-day cycle for applicable transactions and exceptions; the paper ledger does not simulate settlement availability.
Access: Public official page inspected with the web reader on 2026-10-01; no broker tools or real transactions operated.
Reuse: Concept references only. All prices, records, charts, worked examples, exercises and questions are original fictional LifeStarter material; no source diagram or exercise copied.
Source & access notes · checked 2026-10-01
Inspected current transition guidance on 2026-10-01. No fixed historical PDT minimum or operational margin-eligibility rule is taught.
Access: Public official page inspected with the web reader on 2026-10-01; no broker tools or real transactions operated.
Reuse: Concept references only. All prices, records, charts, worked examples, exercises and questions are original fictional LifeStarter material; no source diagram or exercise copied.
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