I notice a lot of people say there are a lot of differences between the demo and real money accounts. What are these differences? I’m assuming all user differences i.e. less risky trades etc etc. Thanks.
The biggest difference is what happens between your ears when you start trading live.
That’s what I thought.
Eh, I wouldn’t say that’s the biggest difference. I’ve tested quite few strats in demo, then went live with very small pip amounts. Traded at the same time, same time frame, same exact entrance and exit criteria and had big differences in end results, that wasn’t due to me making psy mistakes.
True dat.
Some of the oddball demos have quirks.
I had a demo that based market buys and sells on the “last” number.
It made a difference on entries and exits.
But anything on MT4 will automatically include the spread related to the pair traded. The results are very accurate.
I’ts not that demo’s have quirks, I think it’s that demo is simply not the same as live, because live is price moving on real money.
Whenever I see one of these threads I point to a very good article that was written by NickB on forex4noobs:
[/B]__________________
John (Merchantprince)
[I]“Nobody can be exactly like me. Even I have trouble doing it.”[/I]
Haha! Loved it
I personally never noticed a difference between live and demo in terms of any strategy I traded. For me the greatest difference was the psychological aspect of real money vs. fake money.
As far as I am concerned, the one guaranteed correlation between a demo account and a live account is that you will definitely lose real cash if you’re consistently losing fake cash.
It is worth developing and testing a method in a demo environment to establish a track record of sustainable profit before going live… dont kid yourself though, wins dont necessarily transfer between the two but losses certainly will.
demo is for develop strategies and backtesting…
I think you can trade about less than 100 dollars and you’ll still see the difference
I’m grappling with this right now. I opened a live account last week. Haven’t funded it yet. Still trading on demo. I’ve realized I’ve learned enough to start trading. I mean you can always learn more, this process takes years. I recently became profitable with my trades, around three weeks ago.
I guess I just need to give it a shot. Apply my system. And give it my best.
I think the best way to ease yourself into a live trading environment is to take any expectations of profit out of the equation. Now you should always WANT profit, but that’s a totally different thing than expecting profit. Losses will make you emotional if you expect to win, and you will want to blame SOMETHING for taking your money.
The real test is to see how well you tolerate losing money. Actually it’s more like how you tolerate having your money STOLEN. The truth is that the market is the one taking your hard earned dollars away but it could only do so because you offered it. Eventually with experience you’ll realize that in order to stop losing money you have to stop offering it to the market.
a lot of the time people can’t truly admit to themselves that they are offering the market money. so they skim over the real problems and have a terrible time holding any profits.
This makes so much sense. Yes. When I do enter a trade, there is this expectation/hope of it being a winner.
You know, you mentality I should have for forex, I already have for stocks. I’ve lost some money, made some money, but have in the overall been profitable.