Emotion Implications Of Paper Trading

In my attempt to learn as much as I can
about paper trading, using demo accounts
and various trade simulators. One guy
on youtube said beyond a certain point
paper trading becomes useless as it is
just simulating. And there is no emotional
attachment as one isn’t playing with
real money. He said trading is 99% psychology.

It is very much similar to what I read in
New Age Wizard about one needing to
feel the pain of loss in order to become
a good trader./

One trader said he would rather trade with
someone who only have a few thousand
then a millionaire.

My approach to this is to start a micro-account with
an with around £300 and except that this is the
cost of learning the emotional side of trading.

But I believed, before that in the real trading
environment, I would trade exactly the same,no?

I think the best thing is to first prove yourself on demo, if you can trade profitably on demo for a while, open a small live account (£300 or whatever your comfortable with losing). Only move on to a full account when you can trade this profitably.

Some people can’t take demo seriously though, so maybe it’s better for them to just start with a small account (it’s their money at the end of the day!).

Yeah, you find different emotions come into play when you play live. Like impatience ( “this looks like it could develop into a signal on the next candle…hmmm MAYBE I SHOULD GET IN NOW!” ) , fear ( " well I’ve made 25 pips…my target isn’t far away, maybe I’ll sell just to be safe and not lose what I’ve already got! ").

Demo trading is mostly for testing strategies in my opinion. If your strategy is profitable on demo, then it most likely will be as well on live, AFTER you get rid of the little emotional kinks and eventual little differences you might find.