MarketWatch Stock Market Simulation Game & jStock

At first glance you may be wondering what a Stock Market game has to do with Linux and why it’s being written up in a blog designed to explore technology education and all-things technology.

In this article, I’m going to introduce you to a stock market simulation game that I’ve become very interested in and I’ll show you how an open source app called jStock, which runs in the Linux Terminal, has helped me to manage my virtual stock portfolio and assist me in deciding when to trade (buy or sell) stocks on the Market and in what quantities.

MarketWatch Game

I became interested in the Stock Market over a year ago and decided that I wanted to have a better understanding of how it works and how one could go about learning how to trade stocks on the major Stock Market platforms, such as the Dow, S&P 500, Nasdaq, Commodities, Futures, Oil, Gold, Crypto, and more. I discovered an online Virtual Stock Market Simulation Game called MarketWatch. On this platform, you register a free account, then either join an existing Stock Market game or create your own based on the rules setup by MarketWatch. The entire idea was developed by MarketWatch in conjunction with the major financial brokerage firms and institutions as a way for K-12 school teachers to teach children how to invest wisely in stocks, commodities, futures, oil, gold, and the like while teaching them how the Stock Exchange functions and what the rules are regarding the trading of stocks.

Back in early February, I joined an existing Stock Market game on MarketWatch which was only a few days old, which goes by the name of WallStreetBets. Here is a look at the overview of this platform:

WallStreetBets Stock Market Game

On the Overview tab, the platform reveals the Virtual Stock Market game’s name, my name, my net worth, today’s gains, my overall gains, overall returns, cash remaining, buying power, short reserve (if applicable), cash borrowed (if applicable), the stock portfolio allocation, information about the game, and a button to invite others to join in and play the game with you. In my particular game, WallStreetBets, there are a total of six players at the time of this writing. The Portfolio tab reveals such information as my entire Stock Portfolio sorted in various ways, such as from most to least valuable; the portfolio performance by date of stock transaction; history of transactions and pending orders; and Market News. The Rankings tab shows my profile, then compares my ranking with that of the other players in the game. And, finally, the Settings tab lays out the game info; game settings; and Symbols Available for Trading, such as the Traded Indexes, Traded Exchanges, and Traded Security Types.

Game Settings

The object of the Virtual Stock Market game is that each player starts with a starting balance of $1M in cash with which to play the Stock Market. Each trade (buy or sell) placed reduces or increases the cash balance accordingly based on the price of the stock at the time of the trade times the number of shares traded. There is a 1.00% trading volume limit on trades as well as a $2.00 minimum and $500K maximum on the price of stock that may be traded. And, finally, each trade incurs a $10.00 commission or brokerage fee. Players can take advantage of Margin Trading. Margin accounts offer flexibility to investors, who use the strategy to take advantage of market opportunities by borrowing money from their brokerage firms to buy stocks that they may otherwise not be able to afford.

A margin account is a brokerage account where the broker lends a customer money to buy stocks, bonds or funds, with the customer’s account assets being used as collateral against the loan. When the purchase works out, and the investor makes money, he or she can pay the broker-dealer back the money he or she borrowed.

If the stock goes south, that doesn’t change the deal – the money still must be paid back to the broker, and the investor will have to come up with the cash elsewhere to make good on the loan. Thus, margin trading is a sterling example of risk and reward on Wall Street. The Credit Interest Rate is 3.00% and Leverage Debt Interest Rate is 6.00%.

Short selling is enabled in the WallStreetBets game. Short selling is an investment or trading strategy that speculates on the decline in a stock or other security’s price. It is an advanced strategy that should only be undertaken by experienced traders and investors. Some key takeaways in short selling are:

  • Short selling occurs when an investor borrows a security and sells it on the open market, planning to buy it back later for less money.
  • Short sellers bet on, and profit from, a drop in a security’s price. This can be contrasted with long investors who want the price to go up.
  • Short selling has a high risk/reward ratio: It can offer big profits, but losses can mount quickly and infinitely due to margin calls.

Limit Orders, Stop Loss Trades, and Partial Share Trading are also disabled in the game in which I am currently participating.

JStock Terminal Portfolio Manager

To assist me in making trading decisions, I came across an open source and free Stock Portfolio Manager app which runs in the Terminal called JStock. I installed JStock by visiting the homepage for this app and clicking on the download link to obtain the package for my particular operating system, which is Linux. JStock is available for MS Windows, MacOS, and Linux users. The current stable version is JStock is also available for iOS and Android. Some of the features offered by JStock are:

  • Stock Watchlist – 28 Worldwide Stock Markets
  • Portfolio Management – Including net worth calculation
  • Email Alerts – For rules you setup on stocks that you wish to monitor
  • Indicator Filter – Stocks that are good stocks you wish to find
  • Charting – Graphically presenting a 10-year history on stocks you follow
  • Cloud Storage – Personal storage area for your stock data
  • Currency Exchange – Shows foreign stocks in local currency rates
  • Stock Market News – Provides market news so you can make a more informed decision on your trading strategy
  • and more

I downloaded the file and copied it to a directory I created in my $HOME directory called /opt. After unzipping the file, I descended into the ~/opt directory and chmod +x the file to make it executable. Next, I edited my ~/.bashrc file using nano and created an alias for jstock which looks like this:

alias jstock="~/opt ./"

Now, after restarting the Terminal, I can execute the JStock app by simply entering “jstock” at the command line and hitting the Enter key. The JStock app opens and looks like the following:

JStock Opened on the Portfolio Management tab

As you can see, the current position of the Dow Jones, NASDAQ, and S&P500 Markets are shown at the top and I have loaded my stock portfolio from the WallStreetBets game into the application. The Stock Code; Symbol; Previous, Last, High, Low stock prices; Volume for each stock; Change in stock price, Change % in stock price; Buy and Sell Prices as well as Buy Quantity and Sell Quantity are shown. If you click on the AMZN stock code within the game, you will receive the following detailed information on this particualr Amazon stock.

Amazon Stock Quote in Real Time

Clicking on the Stock Code for AMZN (Amazon, Inc.) displays the current quote in real time (not delayed 15 minutes unless specified) and from this screen, you’re able to trade by clicking the Trade Now button or receive an even more detailed stock quote by clicking the Full Quote Page. In addition to this, at the top of this window, you are also able to place the stock on a WatchList, by clicking on the Add to WatchList button and create an alert on AMZN by clicking the button Create AMZN Alert.

If I open JStock on the Stock WatchList tab and double-click on another stock, such as AMD (Advanced Micro Devices, Inc.) the following information is displayed in the app:

AMD Stock Quote Rendered in JStock

But, one of the nicest features of JStock which assists me with making informed decisions about buying and selling stocks, how many, and at what price is the info revealed in the Buy, Buy Qty, Sell, and Sell Qty columns in JStock. This indicates by stock at what price a Buy is recommended, and how many shares should be purchased depending on real time stock market position and share value as well as at what price a Sell is recommended, and how many shares of a particular stock should be sold depending on the real time stock market position and share value of the stock.

Another neat feature of JStock which helps when making trade decisions is the ability to use indicators you can turn on in the app which charts the stock performance using something called Exponential Moving Average and the concept of Moving Average Convergence/Divergence (MACD). MACD is a trend following indicator and is designed to identify trend changes in a stock that show whether a stock is trending upwards, remaining stable, or trending downward. The formula for this can be expressed as follows:

MACD = EMA[12] - EMA[28]

where EMA[12] is the Exponential Moving Average for a 12-day period and EMA[28] is the Exponential Moving Average for a 28-day period. If the MACD is a positive number, this indicates the stock is trending upward. If, on the other hand, the MACD value is negative, this indicates the stock is trending downward. An MACD of 0 would indicate a stable non-trending stock. If I want to see, for instance, whether MSFT stock is trending upward or downward, I can call up JStock, double-click on the MSFT stock code in my WatchList or enter the stock symbol in the Stock search window, click on the Technical Analysis menu option and select EMA – 14 Days, repeat the process for EMA – 28 Days, then this produces a chart indicating a line graph representing EMA for the 14-day period (shown in blue and a line graph representing EMA for the 28-day period shown in red. If the blue line is below the red line at any point of the month in the chart, this shows a negative MACD value indicating the stock is trending downward at that point in time, while at points on the graph the blue line is above the red line, this would indicate the stock is trending upward during those times.

MACD Chart for MSFT in JStock

JStock has an online help feature and user’s manual to assist anyone who wishes to further their knowledge in playing the Stock Market and improve your overall stock portfolio position. Check it out. It’s free and fun to play, plus, you’ll gain valuable knowledge of how to leverage the stock market to your advantage if you ever decide to put up your own cash instead of virtual money. Just remember that there are no guarantees in the market and it fluctuates wildly at times depending on the political and financial situations in the nation and the World. Have fun!

Author: Lloyd Byron

Nom de plume for Dan Calloway

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