Is demo trading enough before real account?

I agree, order processing speed is different between demo and live accounts. Usually it's best to compare the two by opening a small live account to see how both types of accounts behave, and if you're unhappy with the results you can always move to another broker.

It all depends on what kind of broker and platform used if it differs between demo and live accounts. I don't really think it is that much of a difference. When trading live so many other aspect comes into the picture, that can cloud our judgment to believe that when when we are trading live, everything change. Suddenly we get much more slippage, stop loss hunting and so forth. It's more of an emotional issue and psychological issue I believe. No matter the status of the account, live or demo we have to protect our trading account. Because when trading live we are trading against the best traders in the world and they won't give up their money without a fight.

kricka posted:
It all depends on what kind of broker and platform used if it differs between demo and live accounts. I don't really think it is that much of a difference. When trading live so many other aspect comes into the picture, that can cloud our judgment to believe that when when we are trading live, everything change. Suddenly we get much more slippage, stop loss hunting and so forth. It's more of an emotional issue and psychological issue I believe. No matter the status of the account, live or demo we have to protect our trading account. Because when trading live we are trading against the best traders in the world and they won't give up their money without a fight.

I think it is true, the right way is to become one of best traders in the world you written about ;) And about live/demo, by different brokers, I not notieced yet that any huge news or other different sources of volatility would have same effect to demo as to live.

AziH,
thanks for you kind words. Well, actually we don't need to become one of the 'best traders in the world'. We can reap the rewards and benefits of their mistakes. Every trader make mistakes, even the top notch ones included. What is the trademark of a really good trader? I will try to list a few trademarks below that comes to my mind, in order.

1. Risk and money management
2. Trade with the trend
3. Go against the trend when it's oversold or overbought.
4. Place the stop loss and target above or below resistant levels.
5. Do not trade during news releases, unless absolutely necessary.
6. Never overtrade if the daily or weekly goal is achieved.
7. Stop trading if the trading is not in sync with the market.
8. Positive thinking and the right trading psychology.
9. Never give up even if there is a downturn in the performance.
10. Always remember there is a new trading day tomorrow.

These are just a few and I guess one could list hundreds more or so, to make this list complete :).

Money and risk management are the most important but finding someone who trades for a living is the best possible way. Also for new traders is better to trade the higher timeframes rather than the lower 5/15 min timeframes as these moves are made to breed confusion amongst traders and unless you understand how the market really works/moves then you will get into trouble quite quickly

chrish9070 posted:
Money and risk management are the most important but finding someone who trades for a living is the best possible way. Also for new traders is better to trade the higher timeframes rather than the lower 5/15 min timeframes as these moves are made to breed confusion amongst traders and unless you understand how the market really works/moves then you will get into trouble quite quickly

Generally what time-frame one will trade on depends on their strategy. Some people use pretty profitable strategies using the smaller time-frames. That said, in my own personal experience, 4-hour and daily time-frames give the most reliable signals.

It all depends on the strategy. Long trades with larger TP targets won't be much different in demo than in real. Scalper or news trade however is not realistically traded on, no matter what.

stian posted:
It all depends on the strategy. Long trades with larger TP targets won't be much different in demo than in real. Scalper or news trade however is not realistically traded on, no matter what.

True. Both scalping and news trading hugely depend on broker conditions, and those vary widely.

As Mark Douglas said, paper trading or demo trading is very good for showing us our 'profit gap' and most of us have them, the difference between our results on demo/paper trading versus live. It shows us how much we need to improve. Personally I believe demo accounts have been very helful but that's just me.

To the OP, 'is that enough?'. When I first started trading a few years ago I just read heaps for about 4-5 months before I even opened a demo account and I constantly read from the pros that it takes 3-5 years to 'get it'. I thought yeah right, not me, I'll blitz this thing in less than 12 months! I'm well in to my 4th year now and I was only thinking the other day how right they are and how wrong was I. Anyone can get good results over a relatively short period of time but consistent results takes an enormous amount of time spent, development both personal and system wise and a pinch of good luck.

I wish you all the best on your journey!

hello flipper58, you said lots of people can get good result but can't sustain it, is it because the market will mutate every once in a while....so that's why demanding traders to act accordingly....? without firm grip of methodology and flexibility cannot keep up w/ a good positive result? Thanks for sharing.

jchan posted:
hello flipper58, you said lots of people can get good result but can't sustain it, is it because the market will mutate every once in a while....so that's why demanding traders to act accordingly....? without firm grip of methodology and flexibility cannot keep up w/ a good positive result? Thanks for sharing.

Hi jchan, there's lots of reasons but personally I don't think the market changing is one of them. One of the things I read very early on was that once you find a system that suits you stick with it which many people don't do. They get a few losses and decide the system doesn't work and then change it. The next system they find isn't the Holy Grail so it's rinse and repeat and they end up going round in circles. What these same people don't realise is that it's not the system failing, it's them. There are loads of good systems out there that work, it's us that doesn't.

I firmly believe that there is a Holy Grail in trading, it's us, it's in our own heads and not any system or black box. Lack of discipline and not sticking to system rules if it's a mechanical system is a big account killer but achieving it is easier said than done and it takes a long time to get your head straight. I also believe trading is 80%-90% psychology/us and 10%-20% system.

I can only comment on what I've done to get to the stage where I'm at but I've stuck with and developed my system over nearly 4 years, I've tweaked it and made it evolve until I was happy with it and have spent literally thousands and thousands of hours in front of a screen during that time. I trade M5 only so screen time for me has been invaluable but there's loads of ways of skinning the trading cat, you just have to find one that suits you and your personality and then continually work on YOU but whatever you do don't keep changing things.

I still have a fair way of my journey to go. I'm at the stage now where my system makes double what I do every single day, my job now is to close that gap.

Many people become greedy. I had a really good system early, it performed well with really low drawdown, and what did I do? I quadrupled the risk after just 3 months of trading. Shortly after I lost my entire profit. One lessen learned.

stian, it's a good sharing of your experience. quadruple your risk means you have a 4times stoploss distance? what makes you come up with this decision? without a rational reason, suddenly you 4x your risk means you change your stoploss from near to far? and the change comes after you evaluated the near key levels? I can hardly imagine which part of the equation we can suddenly quadruple without a big shake in the whole strategy....the only one I can think of is the account balance which was pumped up extensively...not because of loss...it's because the strategy has tested with sufficient period, and you decide to escalate the account size. what do you think? IMO, I'll be very careful to choose the timeframe that fits my personality and trading strategy, then, I'll have to plan what win rate/rr ratio/ dd I want to use, once set, I don't think I can suddenly change the rr-ratio for a 4x scale because it turns a short term trade to a medium, or medium to medium-long. Extensive change of risk ratio without balancing by reward and timeframe is not right for me... and if all these are changed simultaneously..basically you are changing your whole strategy to a rather different species.

What is everyone's advice for moving from demo to live?

I've had a go at it with 2 brokers, but it seems like they were doing some funny business on the live account as the trades didn't match up... Is this just real market conditions like they say?

Feel free to contact me directly if easier.

@jchan Quadtruppel the lot size and therefore risking 4x the capital at each trade. Using the maximum drawdown the last 3 months as reference, getting a new larger than 4x the old drawdown was a bit of a shocker for a new trader. But it came from greed, I simply wanted more profit.

Hi Pearl,

Which brokers have you used where you have had funny business as you say? They all hunt stop losses (they can see overall where the stop losses are in the market). But some brokers are worse than others.

chrish9070 posted:
Hi Pearl,

Which brokers have you used where you have had funny business as you say? They all hunt stop losses (they can see overall where the stop losses are in the market). But some brokers are worse than others.

With all due respect guys why would you be trading with brokers these days that are not true ECN's? There is no need to trade with bucket shop brokers any more even if you're trading 10 cents a pip and a $200 account. If your stop gets hunted with an ECN broker then it's not the broker, it's the banks and big players and they don't give a damn about retail traders and they can't see your stops either, if you get taken out you are just collateral damage. If you're trading longer term the answer is don't put your stops in really obvious places, the bank traders love it.

My advice for moving from a demo to a live account is first of all to open a small live account until you get used to trading with real money, my other advice is always research the broker you decide to work with. Make sure they're licensed and registered and online reviews about them are good.

how do you know a broker is a ECN broker?