THINGS YOU SHOULD KNOW WHEN OPENING A DEMO FOREX ACCOUNT
You may get a little bit confused when you see new Forex traders having a higher than normal trading balance in their trading account. The Forex trading account may be having a balance of about $50 000 — $100 000 reflected on a screen when trading online, but if you believe to this saying “ not all that is glittering it is gold” your mind might coal down a bit by wondering to know what is exactly happening with the account.
By the time you get closer, you will be welcomed by these disappointing words (DEMO FOREX ACCOUNT) that eventually take all hopes of being rich away.
Everyone can have this huge amount within seconds by opening a Demo Forex trading account with any Forex broker of his choice however it will never make a different in your life, meaning you can’t pay your expenses , you can’t buy your dream car , you can’t marry the beautiful woman you wanted to marry for the long time. Why was this huge amount given to you if you can’t even use a cent from it? OK- let’s just take a look at what exactly is a Demo Forex account?
WHAT IS A DEMO FOREX ACCOUNT?
A Demo Forex account is the non- real Forex trading account that is used for practice purposes. The account is used mostly by online Forex traders who want to develop themselves in getting more trading skills. Every new trader need to use a Forex demo account or a practice account before he can start opening a real Forex trading account, this is done to avoid huge loss of money.
HOW TO OPEN A DEMO ACCOUNT?
A Demo account is acquired by opening a trading account with a registered Broker. The Forex Brokers will be more than happy to give you access to trade in their online trading system where you can trade different currencies of all countries.
The Forex demo account will teach traders how to open trades, how to close trades and where to put the stop losses and take profit. This is the best way that will help people to learn to trade successfully without losing their real money. Almost every successful trader started trading using the Demo account avoiding to be hit so hard with real trading.
Trading on the Demo account will help you analyse your level of understanding while trading, you will know your strength and weaknesses so easily.
CHOOSING THE RIGHT BROKER
One of the most important parts here before you are being offered many Demos to choose from, is to research the best Forex broker that you can use in your daily trading. Make sure to check whether the Broker is registered and also you should check their spreads, platforms and their success rate, try to hear more reviews from different people. There are those brokers that may shape your trading career positively and also there are those who might create a trading phobia for you, so it is much advisable to choose with caution.
DEVELOP A TRADING STRATEGY
When you trade on a Demo account you should make sure that you develop a winning strategy, one might ask- what is the winning strategy? The answer is simple, any strategy that generate you a stable reoccurring profit is a winning strategy and should be applied in the real account.
We understand that trading for a first — second — and few days might not be so easy however trading is the life learning path, even successful traders they sometimes take a wrong turn and the reason for that is because the Foreign exchange market is affected by many predictable and non-predictable factors. It is very impossible to make a 100 % in all your trades however you should always try to maintain at least a 70 % wins and 30 % losses. When you continually obtain these margins then you are heading towards your success.
You have heard it when they said “practice makes perfect”, with too much practices on your demo account it will help you understand the market much better and you will trade with confidence knowing very well what you are doing. However if you find some difficulties you may copy other trade or mirror their trade from other successful people, your Forex broker will usually provide you with a list of leading traders within their brokerage.
