Three Reasons to Use FXPro Demo Account And Three Reasons to Avoid Demo
I have started with FxPro Demo account myself, and I am sure it was a good idea. A demo account is only a tool that can help you with your transition to live trading. Yet, this tool has got some pitfalls. Let’s discuss the benefits and the drawbacks of demo trading.
Why is it a good idea to open an FXPro demo account?
1. A demo account can help choose the most suitable trading platform.
I’ve already published an FxPro review on available trading platforms. Nevertheless, I understand that people are all different in their preferences. Some don’t like innovations. Others want to experiment. Some perceive their smartphones as body extensions. Others hate the small screens, gestures control, and other mobile apps specifics.
Registering several demo accounts with your broker can help resolve all the doubts. At zero costs, you can get the feel of all the platforms, and later when you make up your mind, you can verify the live account and trade with the platform of your choice without any doubts and regrets.
2. A demo account can help you in your career path.
Have you ever heard of 10 000 hours rule? The rule says that no matter how talented you are, spending ten thousand hours doing the same job can master your skills in doing it to the professional level. The legend says, The Beatles themselves had to play 10 000 in the pubs before they learned to light the stage with an outstanding performance.
Do you think this is possible to start trading live and succeed at once on the market? Well, I don’t believe that any of us has still got this illusion. I’m not sure that making ten thousand demo trades can help you become a market guru, but demo experience is also an experience. The more charts you look at, the more trades you make — the deeper your understanding of price action gets. If your plan is to develop a strategy or trade manually — the FxPro demo account with its free market quotes can help you on this path.
3. A demo account is useful for testing new strategies and developing your trading style.
Some specialized backtesting apps can help traders develop, master, and test their ideas. Nevertheless, trying these ideas on real-time quotes is very important. A demo account is a great tool to test your trading strategies and approaches without risking anything.
Especially it can be helpful if you pursue the career of a so-called intuitive trader. Intuitive does not mean reading the market signals with a crystal ball. When I say ‘intuitive,’ I keep in mind the trading approach when you react to the market changes and perceive all the signals at once by looking at real-time charts. FxPro demo account can give you time to practice as long as you wish before you start risking some real money.
The dangers of trading on a demo account for too long
1. Demo executions are different from live ones, and you don’t get the feel of the real market
When someone posts a successful trade in trading communities, a question always pops up: is it a demo or live account? Even if people are polite enough not to ask that out loud, trust me, that’s what everyone is thinking about. There is a reason for that.
First of all, demo executions are not exactly the same as live executions. Quotes are the same, but executions are not. For example, if you’ve managed to exit your trade with a profit target limit order right at the top/bottom of the swing on a demo account, this means that your order would most likely not get filled on a live account. The limit order has to have a counterparty. The quote appears there regardless of the volume of a real deal that took place. However, if your live account limit order is not the first in line or has an excessive volume, it might not get executed in real-life circumstances.
Demo accounts never have slippages and requotes that you might have to deal with when trading on a live account. This is an important thing to consider, yet this is not the most significant danger you can face. The danger lies in the field of psychology.
People simply don’t experience the same emotions when they trade on a demo account. On a demo account, you are more likely to strictly follow your own strategy, wait patiently for your profit target, and leave your stop-loss order where it belongs to. Live trading is all about fighting your demons. This is why demo results can’t be used to predict your success on a live account accurately.
2. There is a risk to develop bad habits on a demo account.
This danger is a direct result of danger number one described in the above paragraph. Risking too much or too carelessly can generate outstanding demo profits. However, getting used to careless trading is not a good idea at all.
My advice is not to avoid demo trading. However, once you register FxPro demo account, make sure you treat it seriously. I know it’s really easy to register a new one if you blow out the whole demo deposit. Yet, you don’t want to make it a habit when you switch to live trading.
3. There is a risk of getting stuck in personal perfectionism.
People say practice makes it perfect. This is not exactly true in this case.I admire the beauty of the charts, and I strongly believe that the market is the fairest place in the world. You get what you deserve here in absolute accordance with the law of supply and demand. Nevertheless, this is simply impossible to make 100% predictions or create 100% reliable strategies that will work here. There are too many factors to consider, and there is a butterfly effect that works on the market too.
I’ve seen people searching for a holy grail on the market for years, and I think that at some point, it turns to be a total waste of time. Successful trading is impossible without some losses. As long as the profits exceed the losses — you are OK to trade live.
So feel free to register the FxPro demo account, register it again with a different trading platform, register another one because you blew out the first one — that’s OK. Simply don’ forget to switch to live-trading once you feel you are ready. After all, it’s all about money, isn’t it?
