The Right Way To Use A Demo Account

Demo accounts are offered by every Forex Broker on the internet. However there is a right way to use a demo account and a wrong way and most important knowing when it is time to move from a demo account to a live trading account.

Novice traders should use demo accounts to test strategies and theories and not as a playground for fun. Simply put, too many new traders spend so much time testing different ways to trade, they never move to a live account. Your purpose is to get comfortable enough to move from simulated trading to live trading.

Using various demo accounts will allow you to see different leverage offerings, different trading platforms and get a better understanding of brokers. The only way you will really know if a broker offers what you want is to use their simulated accounts and test the platform for yourself.

The old theory is that you should only move from a simulated account to a live account when you have consistently made money in that demo account. There is one important factor that everyone forgets, simulated and live trading are not the same. While a simulated account can indeed mimic the movements of your account based on your decisions, it cannot duplicate trading with real money.

Using a demo account correctly is important for a novice trader to use to prepare them for live trading. Look for demo trading account that have features you find important. Download and use different demo accounts as you can find to better compare different brokers.