Forex trading has a learning curve. Ask any expert and they’ll tell you that you’re going to lose money when first starting out with forex. But there is a better way: demo trading. This type of trading may seem like a waste of time to the beginner who wants to make money right away, but it’s not.
Why Forex Trading for Free is Smart
When you’re trading for free, you’re building your own experience level. You’ll use these free or demo accounts to learn how to conquer the markets. You won’t be trading real money, and you won’t be losing real money either.
Professional traders use the Opteck platform to open a demo account, and then they’ll:
- Test out new strategies
- Learn what type of trader the person is
- Learn the basics or new rules
You’ll use a demo account to learn the mechanics of trading, and you can limit your risks due to inexperience when you trade real money.
But there is always the concern that when you transition from a demo to a real account, you’ll have a harder time with losses. If you lose $50,000 in fake money, it’s a lot easier on your conscious then if you lost $50,000 of your real money – remember that.
Say, for example, you learn about CFD trading.
You may ask yourself “what is CFD trading?” The concept sounds simple enough, but if you want to try it out without a demo account, you’ll likely lose money. A free account allows you to overcome these hiccups so that you can learn what you’re doing without having to suffer major losses along the way.
Success on Demo Accounts Before Live Accounts
There is a stigma among traders that is a little confusing at first. The idea is contradicting at first, but it does make sense.
- If you can’t find success on a demo account, you’re almost guaranteed to fail on a live account.
- Trading on a demo account isn’t the same as trading live.
The second point is what’s most confusing amongst new traders. Emotions and the reality that you’ll lose real money on a live account are the main factors in this statement. If you lose $10,000 on a demo account, you won’t be emotionally attached to it in the same way as if you’ve lost 10 weeks of your salary trading.
As long as you understand this and trade as you would on a live account, you’ll learn valuable lessons along the way and lower your risks for future losses.
