Demo vs. live

Yes as rightly said above, demo accounts are crucial for gaining experience and also as a testing tool, so amateurs must try their hand first on demo effectively and then go to live. Forex is not a get rich quick business, so desire to make early gains usually lead to failures.

Yeah its the psychological aspect because your real money is involved so the nerves will definitely get high.

Also, it seems to me, that on demo, there are usually less requotes and slippages. And in real trading there are. isn`t it?

I don’t know if there is a technical difference between demo and real account but yes the physical difference is there. Our human emotions are different while we trade in a demo and in real account.

When I was a newbie, I also thought a lot about this question, but then I understood that it’s best to not spend too much time on a demo account, because it won’t bring you real money…

If one doesn’t know how to trade a live account also won’t bring them any real money either.

For beginners the main thing is that it won`t take away your money :slight_smile:

Demo is the initial stage for tradingand we cannot move to live account without proper knowledge and practice in demo account. We had to spent maximum time in demo account until we are not satisfied with the positive results so live account we can trade with less risk.

Not just beginners. Demo trading or paper trading also plays a crucial role for experienced professionals when testing out new theories or ideas.

Perhaps one of the few careers where you can test an approach with zero risk and reliable results. Personally I am a huge advocate of exploiting demo accounts. At the end of the day if you can control yourself then the difference between demo and live is almost symmetrical.

I disagree about two things - that a demo account is enough for a trader to learn how to trade, as some things can only be learned on a live account , and that there is no difference between demo and live accounts, as requoting and slippage don’t occur on demo accounts but they do occur on live ones.

This is very true, and something that needs to be given a little thought.

But having said that, if a few pips slippage is the difference between you having an edge and not having an edge; did you really have a sustainable edge after all :slight_smile:

Agreed! Though there are differences between demo and live but we can scrape off the importance having a demo account. It’s an important tool where you can enhance your trading knowledge and practice your trading strategy well before going live.

Hi,

When you trade with real money, it matters. In demo account, you can’t feel the pressure of money blew up from your account. But you can get training there. You can check what you think with your demo account. But you have to be careful when trading in Live account.

I think, demo is only needed to understand how the Forex market works. And to practice a bit.
I don`t really understand why people trade on demo for months and years.

This is topic, like so many others, which will not end in a definitive answer.

As long as you understand the benefits and drawbacks with a Demo account compared to a Live account then you can use it as a tool - and a very helpful tool.

The two biggest drawbacks that people bring up with a Demo account is that of Slippage and Dealing with real money emotionally.

  1. [B][U]Slippage[/U][/B]: If a few pips slippage is the difference between you having an edge and not having an edge then you really never had an edge in the first place - you were working on exceptionally tight margins which is ultimately unstable and not a healthy approach to take.

  2. [B][U]Emotional Aspects of Real Money[/U][/B]: This is not a problem with Demo accounts, this is a problem with YOU. A demo account and a live account have the same price feeds. The decisions that you make based on this data is down to you and your own self-control.

As already mentioned, Demo accounts are a great tool, how you use it comes down to your own understandings of how it can potentially help you. We all have different approaches.

Jusuf, maybe you are too young and ambitious, so don’t want to waste time for learning
but demo is a nice instrument that helps to master avoiding real losses

you are brave, but dont be reckless
money can be lost in reality

Practice abit? No no no. No point practice if u don’t even know yourself what kind of trader u Wan to be and the strategy u using… U still be losing even paper money if u hv the wrong concept of forex trading. Wrong strategy. Even gv u 5 yrs u still be losing… It really not that simple… Beside understand the market how it work… U need to understand also the strategy u using. It work best with which time frame. Forex news. Forex market open n close hours. What will happen to the price when market going to open and close. It effects the price u know? U also must know your own emotion… How emotional r u? It really not tat easy. If so easy, whole world is full of millionaire. People trade on demo for month n yrs beside to know the market well. They also testing out their strategy, learning price action… their emotions to the max… Ect… Don’t rush jusuf. Take a step at a time.

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Okay, maybe that would be useful to practice for some months.
But still don`t understand how people do it for years. We start learning about Forex to make money, not to sharpen useless skill for years. You can improve the skill and make money at the same time. Starting from small profits.

Half agreed, some do it for years cos due to emotions unable to control, maybe some of them already have a micro trading account which we don’t know. And they r not making v gd progress. That y they still hold on to the practice account to learn more. There such trader too. The other side is depending on yourself, that is emotion… Start with small like mirco account. But if u nv hv the skill which up to a standard don’t say about making profit, u can’t even break even on your trade even start from small account. Infact u will bust your mirco account, when u see your account balance is getting lower n lower… Your emotions control your mind, your decision, your action. In the end it become… Revange trading… U just dump whatever unit balance u hv in order to just win back that moment of losses… So every trader is dif, that depending on how u look at the picture.

So jusuf, what kind of trader u want to be? Have u already hv in mind what kind of strategy u b using? Care to share any ideal?