Translated from Russian by Google Translate
2 Сентябрь 2009

Features of trade on a demo account

I think that all the traders, when they began trading, have heard that before should definitely make a «run-in» the acquired knowledge into practice, using the forex demo account. That is how the majority of future traders. Using Forex demo account will provide an opportunity to understand what nuances exist for trade and in general what to expect from currency dealing. But the use of demo-account is not limited only by the desire to understand what is the foreign exchange market. Virtual trading account is widely used by professionals currency dealing, the people who have not only round the accounts, but also a solid knowledge.


But, despite widespread belief to the effect that forex demo account is effective, there are a number of statements that the use of this element is not productive and generally a waste of time. Of course, that trading in the live trading account will give more practice, more knowledge and, above all, allows you to well understand the psychology of trading, to develop its line of conduct in view of market sentiment.

That is, if consistently regarded forex demo account, you can see both positive and negative points in the process of its use. Below we describe the basic components that underlie the evaluation of the demo account.

By trading a live account, the trader receives the first knowledge and actual practice. I think that for an amateur to trade live trading account is required. No wonder they say that the theory without practice is blind. Therefore, in this case it is considered that the forex demo account is part of a theoretical program that you need to go.

Many brokers who offer their clients forex demo account, and partly do it to motivate people, give them the opportunity to try their hand without risk. Forex Market - is a huge mechanism, which also requires constant updating. This includes updating the series of its participants. A large proportion of funds that pour in daily foreign exchange market, it comes at the expense of an injection into the ranks of traders of young players. That newcomers are losing money on many of its inexperience.

And so once again it is worth recalling that currency trading is not just a place to come today, and tomorrow is already earn millions of dollars. In order to receive feedback, you need a step by step, carefully teaching them the basics of forex trading is a demo account, and make it up as long as you do not get self-confidence and knowledge that are sufficient to risk real money.

But never forget that when trading virtual money you lessen your level of risk, thereby setting up a completely different way. Trading on the forex demo account, you’ll always know that in any event you have an endless stream of money, but it mostly means that you are divorced from reality, and you begin to develop a false sense of security.

Many of their actions, you begin to assess how reparable, although in real trading such situations could be regarded as critical. It is for this reason, a trader who trades for too long on a demo account, there is a false sense of confidence, which lacks a real trade practices.

Trading on the Forex currency market should be built on the principle of fungibility. If a live trading account does not bring their fruits, you should be sure to stop traffic and try to trade on the virtual.

I have already talked about the moral stability of traders. In trading on the live trading account, this stability is of paramount importance. To become a successful trader, you should know firsthand that such self-control. The practice of trading on a virtual trading account, will certainly be very useful, but only if you trade just as would be traded with real money. Therefore, one of the most important rules concerning the use of Forex demo account is the ability to manage virtual money in exactly the same as you would have disposed of the real means.

In order to reduce potential risks today, many brokerage firms offer their clients a mini-account. Such accounts, depending on the region may vary. And if in North America to trade mini account can be with the amount of $ 25, then in Russia’s sector of the currency market, this amount is much lower and amounts to about $ 10. These mini-account is also called mini-lots.

There are many opinions about the use of Forex demo accounts, but I think that the best option - it is trading on a virtual account a short time. If you bet not intended to test another strategy forex, and elementary teaching them the basics of the currency market, in this case would be a better bargain for several weeks, and then proceed to trade with real money. After that it is not necessary to trade big lots. If I call a trial testing on a real trading account, I never go out beyond the 0,001 lot. This allows me to conduct the necessary research without risking much money.

Finally, I remind you what goals forex demo account:

1. Virtual trading account as a demo account

In this case, the account is aimed at those participants who are not yet familiar with the forex market, or only understands the basics of currency dealing

2. Virtual trading account as a simulator of the trading platform

There are many commercial and analytical platforms, so if you decide to change the platform, you will definitely need to get acquainted with its features. In this case, a demo account will examine the interface program and try it in the work, to further avoid the mistakes of a technical nature.

3. Forex demo account trading strategies as a simulator

In this case, the virtual account is used by experienced traders to test strategies.

Be sure to note the goals it has set for a forex demo account, and never forget that success comes from patience, knowledge and discipline.