Practice makes perfect. This is especially true when it comes to the trading Forex or cryptocurrency. When you find a trading platform that works for you, the next step should be making use of the demo account feature.
What is a demo account?
The demo account feature can be found on most reputable trading platforms. It is funded with fake money and allows the user the experience of trading – enabled with all the regular platform feature. Even better? It’s free!
Why it’s important to start using the demo account
Before you purchase a new car, you take it out for a test drive to determine whether it suits your lifestyle and driving style. The demo account follows the same logic – it allows you to test drive the platform before you make your first trade.
This is why it’s beneficial to use the demo:
It’s like attending a practical training session. You get to learn about all the mechanics of a trading platform without ANY risk. Discover how to analyse the markets and uncover technical indicators without risking your money.
Select your currency pair
There are many currency pairs to choose from. With a demo account, you can test out various currencies until you decide which one you feel is best for your trading goals.
Refining your trading style
Practising will help you get a feel for the platform and help you identify your trading style. With a demo account, you’ll discover trading patterns, what type of trader you are, and possibly uncover your trading goals.
Managing your emotions
Emotions can often cloud your judgement when trading. With a practice account, you’re able to identify which emotions trigger you. This will help when you actually start trading.
The demo account is also helpful when creating your trading plan. You’ll be able to discover:
- The best time to trade
- Which markets you will trade
- The most effective strategy
- Risk management tools
Setting up a demo account is easy and only takes a few minutes. It’s beneficial, especially if you’re just starting out.