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.