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What is a demo-account on Forex and if is it necessary to use it?

What is a demo-account on Forex and if is it necessary to use it?

Demo-account – is a virtual trading account. The word “demo” is short for “demonstration”.

Trade on a demo-account is the most suited way for beginners, because it gives a possibility to puzzle out the functionality of a certain trading terminal and learn how to open and close trading orders without worrying about any risk to lose real money.

Demo-account without registration –is a very rare thing on the Forex market. Most typically, demonstration trading becomes available only after the registration on a broker’s web-site, as for example in Forex4you company. It won’t take you too much time and all you will have to do is indicate your personal data, phone number and e-mail address.

Demo-account is useful solution not only for beginners, but for professional traders who wish to test their new strategies at minimal risks for their funds. Forex demo-account – is the best and free-of-charge option for any trader to get familiar with all the traps and pitfalls of the Forex market, as well as to practice on using various trading strategies and evaluate the quality of a broker’s services.

Demo-account – the best choice for a beginner

Trading on a demo-account, beginners have a great opportunity to develop their own trading strategies and learn how to get large virtual profits. Aside from that, such type of trading – is an excellent possibility to find out how to sense a trend, open and close transactions at the proper time and obtain skills of building support and resistance lines.

As for the technical aspects and characteristics – there is no any difference between a demonstration account and a real one. All services and functions provided by a demo-account are identical to services and functions of a real-account.

Demo-account – is a real breakthrough for any beginner. According to the professional traders, it is better to spend 1-3 months practicing on a demo-account before starting to work on a real-account.

Forex demo-accounts without registration

Nowadays Internet is full of brokers offering to trade on their demo-accounts without passing any registration, but it is for a maximum period of thirty days. So in the Lite Forex company it is enough just to go to the site and download a special program for trading - trading terminal - in which a demo account will be opened without linking to the website account. When this period ends you can open another demo-account or switch to a real-account.

From a psychological point of views, it is much easier to trade on a demo-account, because there is no stressing inherent to the real-money trading.

Psychology of change from a demo-account to a real-account

When working on a Forex demo-account, traders usually experience no strong emotions inherent to the real traders: excitement, different rueful feelings, hazard and even fear. Experienced Forex players assure that you will know when you should stop your work on a demo-account and switch to a real one. But, beyond all doubt, real-money Forex trading is possible only once you had obtained basic skills and necessary level of knowledge. After that there is nothing to stop you from trading with the real money.

It is worth to keep in mind that at the same time demo-accounts have some shortcomings. If you trade on a demo-account for too long and then abruptly switch to a real one, the restructuring process may be quite difficult for you. There is still a difference between these two account types. Working on a demo-account a trader puts no money at risk and stays easy-going about any losses, while trading on a real-account he/she may face real financial losses. If you deal with the real money you must understand that any mistake may come at price.

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