The Financial markets are buzzing and exciting.
Money flows around the globe in huge amounts and at superfast speed.
The opportunities to trade world events and big market moves are always there and always changing.
Yet it requires some degree of knowledge and skill to navigate this constantly evolving maze, so you can seize those openings and cash in.
One of the best ways to help you do this to use a demo account. This allows you to practice trading, test strategies and get used to a trading platform without actually risking any of your own money.
What is demo account trading?
Demo account trading lets complete beginners get familiar with every aspect of trading financial markets, without any risk. For more experienced traders, testing new strategies or ideas in a trading demo account allows them to develop and improve their trading plans – again without any risk involved.
By recreating the experience of ‘live’ trading as closely as possible, a demo account gives you the feel of what it is like to enter and exit a position in any market you choose. This simulated market environment is sometimes called ‘paper’ trading, as you are practicing buying and selling with no possibility of losing any real money.
Demo account trading also gives you the chance to try out all the trading platform’s functions. Understanding how to place orders, manage an existing trade position or multiple positions at the same time, will advance your insight and awareness around ‘real’ trading.
Getting comfortable with what you need to use in a market environment is a key part of trading, as speed can sometimes be crucial to success or failure.
Discover FXTM’s demo account to see the benefits – https://www.forextime.com/trading-accounts/demo-account
What can you do on a demo trading account?
A demo trading account enables you to look at the whole range of financial markets available to you to trade. You can understand and familiarise yourself with how they behave and what suits your trading personality. Or you can learn how to set alerts and monitor different markets at the same time.
Practice trading – with a similar data feed to a live account, market conditions on your demo account will mirror the live markets. Build up your confidence in your strategy and how you use a platform, in a risk-free environment.
If you are more experienced, you can try out other, new strategies that you think might develop your trading success. You can test and tweak parameters to fine-tune results, assured that there is no risk involved.
Risk management – understand the idea of having ‘as live’ positions on, perhaps two or three at a time. Get to a point where position sizing and the placing of stop and limit orders is second nature, as this makes moving to a live trading arena a lot easier.
Platform understanding – read and analyse price charts, quickly and effectively when prices are ‘live’, fill in deal tickets, listen to live news and see how it affects markets. By navigating around the trading platform, you can have the confidence to use all the tools you want to use at the right time.
How do I open a demo account?
To start trading on a demo account, you need to open an account with a recognised, regulated broker.
Once you have your account number and password, you should download MetaTrader4, the most popular and widely used trading platform in the world. The numerous built-in features mean demo account trading is ideal for getting to understand all the functionality of the platform.
It is always best to keep your demo trading account rules as close to your real account as possible. Using similar position sizing, risk amounts, leverage and strategy will help when you progress to a real account.
Demo account trading allows you to practice trading with virtual funds.
Perhaps you want to test strategies on the go with a mobile app?
Or access educational content to take your trading to the next level?
To find out more about demo account trading and how you can might benefit, go to visit us at https://www.forextime.com/trading-accounts/demo-account
Disclaimer: This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.
FXTM is an international online forex broker offering financial services in forex, CFDs on spot metals and CFDs on Commodity Futures, Indices and Shares.
The FXTM brand is authorized and regulated in various jurisdictions. ForexTime Limited (www.forextime.com/eu) is regulated by the Cyprus Securities and Exchange Commission with CIF license number 185/12, licensed by the Financial Sector Conduct Authority (FSCA) of South Africa, with FSP No. 46614. The company is also registered with the Financial Conduct Authority of the UK with number 600475. Exinity Limited (www.forextime.com) is regulated by the Financial Services Commission of the Republic of Mauritius with an Investment Dealer License bearing license number C113012295. Forextime UK Limited (www.forextime.com/uk) is authorised and regulated by the Financial Conduct Authority, firm reference number 777911.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.”
This article was originally posted on FX Empire