Difference Between Forex Demo and Real Account
Differences Between a Forex Demo Account and Live Account June 14, One of the best things about forex trading is that it lets you trade with virtual money to train and improve yourself before investing your hard-earned real money.
Every forex broker offers demo accounts to their clients and trading with a forex demo account is a very wise choice especially for new traders. I always say that.
What is the difference between trading a demo account and live forex trading? Forex demo and live trading account If you are new to the world of forex trading, then an obvious question that would come to your mind is what is the difference between forex demo account trading and forex live account trading?
However, even after a trader gained enough experience and start trading with a real account, sometimes things do not go as expected. Undoubtedly the most important reason for this is the human psychology. So, what is demo account and what exactly is real account? What are the differences between demo account and real account?
Most importantly, they allow a practical means of interacting with trades.
What is Forex Demo Account? Thanks to forex demo accounts, traders can train themselves and they can test their new trading strategies without risking real money.
Difference Between Forex Demo VS Real Account - Demo Account VS Real Account - Forex Help BD
Therefore if you are new to forex trading, I strongly advise you to trade with a demo account for at least few weeks before opening a real forex trading account.
Demo account is identical to a live account in terms of trading platform, instruments and charting. But like I said, main difference is that you are trading with virtual money. Losing your real money always makes you feel bad and this can cause you to take wrong trade decisions by making you overtrade.
Differences Between a Forex Demo Account and Live Account
This is why traders are usually more successful while trading with demo account. If you want to be successful on your trades, you need to make same decisions while difference between real and demo accounts with your live account just like the way you are trading with demo account.
Demo account is a big advantage in this respect because you can train yourself and try a new strategy without risking real money. Since trading with a live account is always far more difficult, I still recommend you to keep your trading volume low during the transition period from demo account to real account. When you are sure that you are getting used to the psychology of trading with real money, you can slowly increase volume of your transactions without risking too much of your capital.
I should warn that trading with demo account for too long may not be a good idea either. Because, it can make you undisciplined once you start trading with real account. You must learn how losing real money makes you feel in order to become a successful forex trader. What is Forex Live Account?
What is the difference between trading a demo account and live forex trading?
Forex live account is where you deposit and trade with your real money. Therefore, any loss or profit is real. In order to be able to trade with a live account, you need to validate your account first.
Some forex brokers let you deposit money and start trading without validation process, while some others require you to verify your account through uploading ID and address documents before depositing money and trading live. Other than trading psychology, live trading account differs from a demo account in terms of spreads, execution and slippage. Depending on your account type, you will see different spreads on pairs in live account than demo account.
Besides, execution time may be higher in live accounts and you may suffer from slippage. So, trading conditions that you are going to see in live account may be different than demo account. However, it is always a very good idea to trade with a demo account for a good amount of time before trading with real money if you are a new forex trader or testing a new trading strategy.
This makes it quite hard to observe emotions that are usually present when trading on real accounts.