When you want to prepare for live trading, a demo account is just a stepping stone. You have to move over it as soon as you have obtained an idea of the market. Open a micro account and practice on it for a better market understanding.
The only use of demo accounts is to get the basic idea of the functioning of the market. If you spend unnecessarily extra time on a demo account, it will start filling you with false expectations that you may never be able to fulfil.
If you enter 2 simultaneous trades on a DEMO and LIVE account see how one will hit TP and the other will be a loser !! thats the difference between DEMO and LIVE! with a lot of brokers especially ones who like scalpers!.
Different spreads , price movements and Slippage make a huge difference so the sooner you have your strategy tested get off DEMO and trade a small LIVE account ! that's the only way and you soon see the 'real' manipulation of a Live broker !!.
Demo almost suckers you in as 'too easy to make profit!' so you go live trade the same and BOOM ! Blown account ! this happens time and time !
Demo is only good for trying a strategy out , LIVE is a different ballgame and not just the psychological aspect.
It will depending pers[ective of each traders to view about demo account. Demo trading is important to learn and get experience trading. Sometimes demo accounts are used among traders to show trading performance when they test ea and want to show if they can make a good income using a demo account. But investor I think they will look and proof of trading and type account before investing.
I’d disagree to an extent. Everything has its pros and cons, and so is the same with demo trading.
Pros - Demo trading is useful for beginners as they can build up their strategy. Demo trading helps beginners to test different techniques, and see which is suitable for them. They can test their trading strategy with different time frames, and different risk management tools, at different price levels to find out a perfect range that can be profitable. The biggest pro of demo trading is that it helps the trader prepare for the live market without risking any capital.
Cons - The biggest pro of demo trading, i.e., not risking capital, is also its biggest con. The emotions a trader attaches to his real money while trading, is not present in demo trading. As a matter of fact, the beginner cannot understand and develop his trading psychology, when he is overtrading, how to overcome the fear of loss, and how to take control of your emotions.
I will say that a beginner must demo trade to develop his strategy for at least 6 months; but at the same time, do not forget about trading psychology. When beginning live trading, you should be conscious and disciplined enough to take actions to develop your trading psychology.
Demo accounts are only meant for practice and trading with real money will be a challenge even after demo practice. But that does not mean demo trading does not help at all and should be skipped. We must try to trade on a demo account as if we are trading with real money so that we can smoothly transition to live trading later on. We may not be able to replicate the emotions that we would feel when we trade for real but can still refine our skills by using a demo account.
Demo trading can surely help you to develop your skills as a trader and it does give us confidence to trade on a live account. But the transition from a demo account to a real account will never be easy. I think actual trading experience is gained when you go live in the forex market and get exposed to the market risk.
It's true! It can only provide you with a taste of what the market could be like. To be well experienced, you need to put in the time and effort to learn the ropes and master the skills required for the job. A demo can give you a head start, but it cannot give you the surety of becoming a successful trader.
Demo trading is helpful for letting a newbie thoroughly test his strategy to find a profitable price range as to when he should enter and exit a trade. Which is why trading is a demo that can help a newbie to improve technical analysis, risk management, and fundamental analysis. However, as no real money is involved, the trader does not feel any emotional attachment to the money he is trading (which is fake money). This does not help the trader to develop his trading psychology and money management skills. This is the reason why many beginners who made good profits in demo trading, failed in the beginning of live trading.
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