5 Tips for Learning More With Forex Demo Trading

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Practise and knowledge are the keys to success in Forex trading, that’s why Forex courses and demo trading are strongly recommended for new traders. During a Forex course, students learn fundamentals, trading strategy, and how to use specific trading platforms. Demo trading is essential to give students the experience to put these concepts to work before embarking on real-life trading.

Demo trading is particularly useful for first-time traders as it provides an opportunity for students to learn about their strengths and weaknesses. Plus, students have the freedom to test different strategies before putting real money on the line.

Under the right direction, demo trading can be a valuable learning experience for new traders. Yet, there are some steps students should take to get the most out of their simulated trading exercises.

  1. Act like you’re trading real money

For demo trading to be effective, you should use the same discipline, risk management techniques and strategies that you would when live trading. Just as the sports saying goes: “You play like you practise,” the same is true with demo trading. If you abandon risk management and sound strategy in your demos, you’re more likely to do it when you go live.

  1. Trade with the same context

Your demo trading should closely mirror the context of your live trades, that means you should use a similar account balance. If you’re prepared to invest $10,000 when you go live, that’s what you should work with in your demo environment. With this approach, you will quickly master skills in leveraging trades and risk management appropriate to your real life needs. In addition, you should test the same timeframes you plan on trading. That is, if you plan to day trade when you go live, that’s what you should do in your test environment.

  1. Experiment with strategies you will use

Although you should treat demo trading just like you would live trading, experimenting with strategies can help you discover your strengths and weaknesses faster. Test your strategies and don’t be afraid to make an occasional mistake – this will help you avoid them when you’re trading with real money.

  1. Remember slippage and fill orders

Some of the things that happen on the trading floor – like price slippage, for example – aren’t often replicated in demo environments, and can catch traders off-guard when they start live trading. Plan ahead and prepare a strategy for dealing with slippage during your demos. Additionally, demo trading is the perfect time to experiment with different types of fill and stop orders. You’ll learn when each type of order is appropriate and the steps you need to take for it to be executed.

  1. Use the same tools

Just as you should be replicating the same context, it’s important to use the same software and platforms you plan to use when live trading. Demo trading offers you the opportunity to master the software you will use to set orders and analyse the charts. Get as comfortable as you can with the technology so you’re prepared when real money is at stake.

Are you ready to take your Forex trading career to the next level? Attend one of Learn to Trade’s Forex courses and receive expert guidance, demo and live trading experience, and access to trading strategy and software.

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