Second post of the above.
Main thing is that forex trader should learn successfully how to manage risk and account. If he is able to take proper risk make good amount of profit out of it in demo account he can go for live trading . He should manage less amount as much he will invest in real account.
OMG! I don’t know if it is just me or you agree with this: I tend to find demo accounts are so easy to use in parallel to live accounts. I am still using demo and I have made a profit of 2.5K in less than a month starting with 5K, too good to be true
It is probably the most relevant post for these who are beginners. Would be looking for consistency in some pairs before deciding on moving to live. There are brokers down there that have much lower increments than micro lots. That is good for traders to try in demo or live. Some correlations between metals and exotic pairs with large currencies and pairs will help out beginners to spread the risk. Great to have less than $50 for beginners and be in many positions and levels. That is what helped me to determine best strategy.
Also, good luck.
In demo trading we should focus on quality trading then we can make our fake profit double and I think we should start the real trading until we get the 200% profit in demo trading and also achieve the proper practical learning in order to get the success in the real trading.
In addition, to the profits needed before trading in a live account, a trader must also be fully ready before jumping into a live account. It would be unwise and risky to trade with your hard earned money just because your emotions tells you to go live.
Lots of opinions on process which is great. Problem is you’ll learn 10,000 times more if you go live and trade micro lots so you understand all your processes go out the window when live money hits. If you cant risk a micro account… then why are you trading? This entertainment then?.. then it doesnt matter. If you want to actually learn faster… go live. Many will disagree and I’m ok with that.
Yes, it’s all down to personal preference.
For one I’m an advocate of demo trading until profitable. If done properly you will see no difference from the performance of a live account which exceeds a standard margin of error (you can work this into your results as a ‘risk plug’)
At the end of the day though, the difference between a micro or nano account and that of a demo account would have little to no mentality differences in my own person opinion, but then again that’s down to ones risk appetite. I guess if you’re going to learn with real money you really need an account size that’s just enough to scare you into taking it seriously, but not so large that you cant afford to eat when you go bust!
In my opinion, jumping on a live from does not have anything to do with profitability but consistency of the trades and self-control. You can never have the emotions of trading real money while you are on a demo and, at least in my case, this makes a big difference. Once you are able to control your emotions you can trade on a live account.
I am in agreement with this. Newbies wrongly think their successes in their demo trades determines how successful they would be also in a live account.
And then big losses come and they start thinking that the market is guilty for it…
Dear profit does not matter, your confidence, way of working and consistency matter, therefore it is suggested that we should perform demo trading sincerely and should apply all the strategies in demo account in order to get the success in real trading.
Well, I used my demo account for a long time! In addition, I opened my live trading account when I was a consistent performer in my demo for three months! And then I have started my live trading with my same trading plan! And this is way, now I am doing live trading without any MC! I see, maximum novice traders aren’t interested on demo, they are too much hurry for starting their live trading; that’s not proper way!
Demo accounts are really a very effective and useful way to experience the market environment before going for live trading. There cannot be any standard amount of profits to be made in demo but one must make sure that he is making consistent profits. Minimum of 3-4 month trading is required in demo before going for real account. However it depends from person to person, knowledge and skills play an important role. Also, it is always advised to start with small amounts in real account.
Just profit making is not a standard to go to live account. A trader should see how much amount he is using and how much successful he is in its management. In demo profit taking is easy so one can think he can make good profit in live account too.
I don’t think the [U]ratio[/U] of profit to deposit should be what matters.
Personally, I’d strongly advise you not to try to trade with real money until you’ve collated the results of a minimum of 300 [U]consecutive[/U] trades on demo [I]without showing an overall loss[/I], and traded on demo for a minimum of 6 months.
It’s not about “how much profit you can make”: it’s about whether you can trade safely over the long term without losing money.
It’s true, but it is interesting to know any certain amount of how much usual trader spent and win to estimate my real progress.
Yes, I see that … well, I think to make it meaningful, you have to look at it in percentage terms (to allow for the fact that people have very varying means and capital available.)
My own opinion (with which not everyone here will agree, perhaps) is that “steadiness” is much more important than “percentage profit”.
That’s because (like most people making our livings this way) I look at it all in terms of risk management, not profit-maximisation.
Let me put it this way: if I were lending money to someone for trading, or backing another trader, I wouldn’t care if they make 3% per month or 20% per month nearly as much as I care [B]how many months[/B] they’ve been doing it for, and what their biggest [B]drawdown[/B] was during that time, because those are the factors that tell me whether or not they’re “safe”.
If someone has traded for 3 months and made an average of 25% per month, they’re very high-risk to me, because I suspect that their position-sizing is inappropriate and that they may well have a “big accident” some time in future (maybe soon).
If someone has traded for 9 months and made an average of 5% per month with no drawdown bigger than 2.5%, I trust them a lot more. For me, that’s the “better trader” of the two. I may be wrong, occasionally, but it’s a “probability function” like everything else, and just as in everyday life, one normally has to make decisions on the basis of incomplete information and “get the odds in one’s favour”.
In my opinion, if you’ve traded for 6 months and done 300+ trades and not made an overall loss, and you’ve had no drawdown bigger than 5%, then you’re doing [B][U]very[/U][/B] well, and your progress is really good, and you’re “probably safe”.
Oh so I see now that switching between demo and live is more time question than any profit result.