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Is demo a step before real trading?

  • #81
  • May 6, 2013 1:11pm May 6, 2013 1:11pm
How can we start right away on a real account. Only those can start who have bundles of money and they are not finding a place to spend it. Any normal man would go for demo before he can trade in real account.
  • #82
  • May 7, 2013 12:31pm May 7, 2013 12:31pm
Well you can start off with a small account rather than the standard option..and track your trades.
  • #83
  • May 7, 2013 3:04pm May 7, 2013 3:04pm
For Ea trading, I would trade with non expiring demos for as long as possible, to get the feel for how the EA handles different market conditions over time. Perhaps after 6 months of consistent performance with reasonable return and DD that coincides with historical 5-10 year backtests, I might graduate to trading 1 micro lot on this EA.

For manual trading, I don't have the advantage of reliable backtesting of 5-10 years on different market conditions, so I would use the demo forward test of my manual system as the next best proxy. The demo can help one iron out the rules of the strategy and see how the strategy performs over different market conditions. If I see that in demo trading I am able to produce a consistent return for three months based on strict rules, I would graduate to trading 1 micro lot in a real account. The step to trading in a real account for manual trading should be sooner than EA trading because only when real money is on the line can the human discipline component of manual trading be tested.
  • #84
  • Edited 7:44am May 12, 2013 5:30am | Edited 7:44am
Hello.

I think this YouTube video might fit into this discussion pretty well ...

Inserted Video


And this one:

Inserted Video



Best wishes!
Curtis
PECUNIA NON OLET
  • #85
  • May 14, 2013 2:54am May 14, 2013 2:54am
Quoting hedging
How can we start right away on a real account. Only those can start who have bundles of money and they are not finding a place to spend it. Any normal man would go for demo before he can trade in real account.
Good post! We have to try demo account before investing money to live account. I didn't have much money, so I did have to find broker that offered cent account like Exness, Fxpro, Hotforex,... With $5 starting deposit, I could get familiar with market. But of course I have to tried their demo account first.
  • #86
  • May 14, 2013 6:22am May 14, 2013 6:22am
Quoting undergroundz
{quote} Good post! We have to try demo account before investing money to live account. I didn't have much money, so I did have to find broker that offered cent account like Exness, Fxpro, Hotforex,... With $5 starting deposit, I could get familiar with market. But of course I have to tried their demo account first.

Yeah Good idea mate. Also make sure to start with a small investment even you do demo trading pretty well.
Because Demo will not teach your emotions. Happy Pipping
  • #87
  • May 15, 2013 1:17pm May 15, 2013 1:17pm
Just try to participate in demo contest and this emotion thing can be brought to play. When you will be thinking of real cash prize then you have to feel the emotions even if you are trading in demo account.
  • #88
  • May 15, 2013 11:26pm May 15, 2013 11:26pm
I've been trading on a demo account for 3 months, I have yet to make any progress at it.

But it sure beats not losing any real money. Thank you everybody for you thoughts in this thread. It helps a lot.
  • #89
  • May 16, 2013 1:32am May 16, 2013 1:32am
Quoting hedging
Just try to participate in demo contest and this emotion thing can be brought to play. When you will be thinking of real cash prize then you have to feel the emotions even if you are trading in demo account.
I didn't know there are such things. Is this common with all Demo-Account-providers, or are there specific partners only for this?
PECUNIA NON OLET
  • #90
  • May 17, 2013 1:53pm May 17, 2013 1:53pm
Are you referring to the demo contest or the part about emotions coming into play with a demo account?
  • #91
  • May 18, 2013 4:59am May 18, 2013 4:59am
Quoting Forexnuts
Are you referring to the demo contest or the part about emotions coming into play with a demo account?
Demo-Contests. And google was my friend. Thus I already know where to look and how to participate ...
PECUNIA NON OLET
  • #92
  • May 23, 2013 2:51am May 23, 2013 2:51am
I have been seeing many demo contests nowadays. Almost every new broker start such contest and they give real cash prize also. So it can be a good option to practice new strategies and win some extra bucks.
  • #93
  • May 23, 2013 11:51am May 23, 2013 11:51am
Demo trading allows the trader to practice the trading without having to waste their own real hard earned money. Thus, with the help of the virtual money in the demo account one can learn and master the forex trading business.
  • #94
  • May 28, 2013 2:58am May 28, 2013 2:58am
Demo is indeed very important in a trader's career. If you practice hard in demo account then there is not doubt that you can make good progress in your real trading as well.
  • #95
  • May 28, 2013 6:35am May 28, 2013 6:35am
Hi, as new trader myself I just started using demo for practice, but I read that using $100 real account is better for practicing forex because of the emotional attachment people have to money. So can one learn forex with real $100 account or demo account. I personally prefer demo, I somehow don't feel confident to start even with $100 real money.
  • #96
  • May 30, 2013 1:12am May 30, 2013 1:12am
Quoting divifx
Hi, as new trader myself I just started using demo for practice, but I read that using $100 real account is better for practicing forex because of the emotional attachment people have to money. So can one learn forex with real $100 account or demo account. I personally prefer demo, I somehow don't feel confident to start even with $100 real money.
So in your case trade demo first and then when you feel confident, may be in one month or two, start trading real account with $100.

Cause if you are not ready to trade on real account you will easily blow up your account.
  • #97
  • May 30, 2013 2:22am May 30, 2013 2:22am
My opinion is that the only true thing is a real account, go on demo if you don't know how to put an order or set a stop loss, etc but then you should go live.

I still don't understand why people spend months or years trading demo, thinking that they will do the same on a real account. It's just smoke and they don't know it.
Simplicity is the Ultimate Sophistication.
  • #98
  • May 30, 2013 3:20am May 30, 2013 3:20am
Quoting broketrader
I still don't understand why people spend months or years trading demo, thinking that they will do the same on a real account. It's just smoke and they don't know it.
Well if you follow a healthy learning process you know you have to do it step by step. You have to learn to make the good decisions and you need to do it step by step. And one step is to prove to yourself that you have a method/system that gives you an edge in the markets. Why do it with real money? It's pointless, it costs you money. But the real thing is that you make it so much harder for yourself because your inner demons will mess with your decisions.

Doing the small steps for as long it is required takes patience. And many many young newbies don't have the patience to learn to trade well first. Staying on demo until one is 3-6 months profitable in a row looks like a big waste of time. In reality is the best thing one can do. Because if you fail afterwards when you trade real money you know that it is you who is wrong not the method - you already proved the method on demo, to some extent it's true.
But if you go straight to live how do you know what's wrong when you fail? You or your method? This can lead to a very very long and hard to break vicious circle. It is time, nerve and money consuming. I know cause I've been there.

Besides, who is interested in throwing real money in the markets as soon as possible? Brokers!
Trading = a mirror to your human flaws. Fix them or be fixed.
  • #99
  • May 30, 2013 3:33am May 30, 2013 3:33am
Quoting soso
{quote} Well ...
I agree with you to some extent.

But you have to agree that the psyche is different when trading on demo or live, so you will (almost) always fail when going live.

That said, 3-6 months for testing a method is fine but if you get used trading in demo for year(s) It will be another story the day you go live and then you will put everything in doubt, not only you.

Simplicity is the Ultimate Sophistication.
  • #100
  • May 31, 2013 3:15pm May 31, 2013 3:15pm
When first starting out, you should demo to figure out how everything works. There's a long period of time experimenting with all the available EA's, scripts and indicators. Experience is needed with margin trading, spreads, platform features, lot size, technical analysis, trade management and the like, all takes time. Keep in mind, small micro or mini live accounts are excruciatingly slow to grow and require greater price action moves to be in the money. I wouldn't go smaller than $500 and after you've blown it up, you will have learned much. A typical demo account starts with $10,000. The deeper your pockets, the much greater your potential. 20% margin calls don't come so quickly and the larger the position the smaller are the associated fees. After blowing up your first $500 live mini account, you will be eager to spend more time in your demo account. Also, it's crucial to demo while getting to know a new brokerage house.
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