tyson_learner posted: One of the biggest reasons could be that some people can't perform well under pressure on live trading. That's why they fail to make money there.
People get overpowered by their emotions when doing live trades. The result of fear is reluctance to enter into a trade or premature closing of a winning trade. We should decide what’s best for us with practice and emotions should be managed while trading.
Demo is where your comfort resides and in live trading the real game kicks in that’s when one should use its capital wisely to gain returns rather than losing it out of greed, but if we talk about demo we gain more money in it because the real emotions do not kick in whereas in live trading our psychology changes and the trader either restricts itself to fully try out their skills or does over-trading out of greed.
Stick to only one strategy to prove it whether it works or not. You have to pick up your strategy based on the type of your trading, like if you are a scalper, you should develop a scalping strategy. Strategy is made by compiling indicators.
Demo accounts are only meant for the understanding and you do not follow risk management there, traders get carefree on that aspect when trading on demo but in live account one have to be careful and that could be a reason why traders hesitate to grab the opportunity, however a skilled trader would always know when to make a market move.
This feeling is common among new traders. However, it shouldn’t be neglected at all because emotions play an important role in your trades. You need to introspect whether you’re ready to make trades. Also, you should understand how much money you can afford to lose and start trading the same way as you used to when trading with demo.
There can be several reasons why a trader may make money on a demo account but not in the real market:
Emotional control: trading with real money can cause emotional responses such as fear, greed, and hope that can interfere with a trader's decision-making process. On a demo account, there is no emotional attachment to the trades.
Lack of discipline: demo accounts can foster a false sense of security, causing traders to take on excessive risk or ignore their trading plan. In the real market, traders must have discipline to stick to their strategies and avoid impulsive decisions.
Market conditions: demo accounts typically have different market conditions than the real market, including wider spreads, delayed price quotes, and simulated execution speeds. This can cause a trader's performance to differ significantly between the demo and real markets.
Different trading environment: demo accounts are typically provided by brokers, which may have different rules, regulations, and technologies than the real market. This can affect a trader's performance and require a different approach.
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