I’ve been demo trading for quite some time but don’t have the confidence to trade live. I can’t say I have a system down pat. But how do you know it’s time to trade live?
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Once you are confident with your strategy and have winning ratio at least 7 out of 10 (this is my opinion). Hope this helps.
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Are you able to consistently follow a plan which is consistently profitable? Then you’re ready to go live. But start with small positions as what demo does not teach you is how you will feel and react and maybe break the rules of your plan when you run through a number of losing trades. (or winning trades)
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When you have a consistently profitable strategy then you can start trading live. If you’re not profitable, if you dont risk the same % per trade, if you dont follow your rules, if you dont close the position when you’re supposed to, then you’re not ready.
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And that 7/10 has to be consistently for a period of 3 months or more. Consistency is key.
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You dont need to have that high win rate. If your risk to reward is 1:2 then 5/10 is fine and it changes with different risk to rewards. Even if you’re 1:1 and win 6/10 you’ll be making money.
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I never traded manually or on demo, for more than a year i’m using a EA that had a video user guide with everything i needed to know, i have never traded before and started directly on Live. What i’m trying to say is find the best tool for you and go live if you want to be profitable.
This is the best advice. Just make sure that you trade with money you’re 100% comfortable losing (b/c you will lose it) AND make sure you’re at least 80% comfortable with how the broker’s platform accepts/executes orders. You don’t want to get into a situation where a trade moves against you and you don’t know how to get out.
Also- make sure you have a backup form of interacting with the broker if your primary method goes down. Not many people talk about this- but, one outlier event can ruin months/years of gains.
Great advice and the question I was going to ask. if you aren’t making money on demo there should be nothing to suggest you will with your own money. if anything it will be worse as the psychological impact of using your own funds will only hinder you if you let it. You need to have a completely indifferent outlook on money yet still want to protect it.
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You are ready to try a live account if you are able to make the consistent profit from demo as possible as you can while sticking with strategy.
Among other things, please don’t borrow money to trade. Use your own money and don’t fund your account with all your savings.
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Thanks! How many months did you trade demo before you traded live?
Thanks for the advice. I won’t be borrowing money to trade and I won’t be using all my savings. But even if I will be starting with a small amount I don’t have the confidence to take the leap.
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Thanks @tommor. Same question as above. How many months did you trade demo before trading live?
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I made a big mistake when I started trading, I didn’t know about demo accounts and I lost a load of money. (I thought I would just do what some friends were doing but I didn’t really understand what they were doing.)
Don’t get in a car and drive at 100mph until you know where the brakes are. Take some time to learn.
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What a crazy thing to do. People do this?
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Dear , I am still learning and still doing on demo since three months.
Moving from Demo to Live trading account is not about how much time has spanned, but more about the Expectancy Ratio of your trading strategy.
Here is a simple checklist to get you started:
- Complete 100 trade positions based on your trading strategy.
- Calculate the Total Number of Winning Trades vs Total Number of Losing Trades
- Calculate the Total Profit vs Total Losses
- Assessment 1: Does your Trading Strategy have a Win/Loss Ratio of 50% or more?
- Assessment 2: Is your Account Equity higher than when you first opened the account?
If you answered “Yes” to both Assessments 1 and 2, you are ready to trade on a Live Account.
If you answered “No” to any of the Assessment questions, take a step back, review your trading strategy, and then open a new demo account for another 100 trade positions based on your revised trading strategy.
So with every new strategy/system, runt he 100 trade test? That’s what you do?
It is unlikely you will bridge the gap without stumble immediately. In order to best position yourself for the transfer I would suggest getting the 30-day trial of Trading View, and backtest the pairs you intend to trade. While back testing, be as hard on yourself as possible, no freebies. Keep track of the drawback, the pips won or lost, duration of the trade, a description as to why you entered the trade, why it succeeded/failed, and a library of winning screenshots.
Once you have compiled atleast 500 trades per pair, with tiny adjustments to your strategy and you are fully confident in your strategy and how it plays out, at that point I would suggest opening an account. Start trading 0.01 lots so you don’t blow your account, and you can start easing yourself into the physcology involved with trading. Slowly increase the lot sizes, 0.01 per $1,000. A good way to maintaining a clear mindset, and to keep emotions at bay is to consider the money you deposit to your account already gone from your possession.
Good luck with your ventures, feel free to shoot me a PM if you ever want to discuss.