Are you new to the Forex market? There’s a lot of information to take in isn’t there. One important part of trading you need to be aware of is Forex trading demo accounts. These are a tool that will help you become a successful trader.
The purpose of a trading demo account is to practice. Just like sports or playing an instrument, you’ve got to practice. The nice thing about this tool is you can have the exact same trading platform as in a real account. Everything is the same. The market data is real. The only difference is the money in the account is fake.
As good as they are, a few points must be watched.
1) Standard Versus Mini. When you start trading, you absolutely must start with a mini account. This is a setting in the trading platform where your lot sizes are small and the margin is low. You want to be sure your settings on the demo version are set to mini to replicate that exact trading environment when you start to use real money.
2) Psychology. Emotions can have a major impact on your trades. Controlling them is a key part to becoming successful. One minor downfall with the demo version is the emotion levels of making or losing money are not the same as they would be with real money. Be sure to try and keep a mindset that the fake money is real.
3) Testing Software. I use what’s known as automated trading software. If you decide to go the same route, you want to be sure that your demo account can be accessed by the software. Most software companies will tell you which brokers you can do this with.
In conclusion, you most definitely want to find a great Forex trading demo account to learn how to trade. Your next step? Find a trading strategy to practice in your trading demo account.