Demo Trading Account: What You Should Look For

More and more people are actively trading in the financial markets. In 2018, the foreign exchange market reached a record high. Getting started in a market that turns over $5 trillion in trade volume every single day can be daunting at first. That is why we advise that your first trading account be a demo account.
What Is A Demo Trading Account?
This is an account that enables you to simulate a live trading environment with virtual funds. It enables you to practice trading quickly and easily before risking real money.A demo trading account helps you get used to your broker and the trading platform you are using, as well as test and refine your trading strategy. All traders should demo trade for at least 30 days before graduating to live trading.
What Should You Look for In A Demo Account?
A demo account should enable you to simulate real trading with the only difference being that you are using ‘pretend money’. You should gain access to the latest trading insights, the latest financial news, and real-time market data. Here are some things you should look for in a demo trading account.
A Range of Products and Markets
You should be able to explore and test different markets and get a feel of how they behave as you find the right products for you. You should be able to explore forex, commodities and precious metals and market indices, but you should check with the broker if you are seeking specific or specialist products.
Gain Technical Experience
You should be able to practice placing different types of market orders such as limit orders and stop-loss orders, practice opening and closing positions, and track profit and loss, as well as viewing margin requirements.
Trading Tools
Your demo trading account should give you access to economic calendars, financial newswire, and calculators, among other tools so that you can learn how to interpret and utilise information from market data and news feeds.
Charting software is invaluable when it comes to learning how to test technical indicators and interpret and utilise charts as well as learning to identify patterns and trends.
Benefits of A Demo Trading Account
Whether you are just starting out learning about trading or are evaluating a broker to trade with, any seasoned trader will tell you that there are many benefits of starting with a demo account.
Get Familiar with Trading Platform and Your Broker
Before you enter the markets for real, it is crucial that you can comfortably open, amend, and close trades when you need to. Opening a demo with a broker lets you get familiar with the trading platform and learn how it works from a user perspective. Knowing how to efficiently use a platform removes a lot of unwanted stress when it comes time for live trading. You do not want to be caught in the panic of not knowing how to close a trading position in the fast-paced real trading environment. It is also an opportunity for you to test the overall quality of your broker’s services and ensure that the experience of trading with them matches up to the promises in their marketing.
Learn to Manage Your Emotions
Risking money to make money can be an emotional game. Adrenaline always finds its way into play. With a few losing trades, feelings of doubt and frustration kick in, while overconfidence and euphoria come with a few winning trades. These emotions are powerful, and they can devastate your trading game by clouding your judgement.Learning to remain patient and calm is an invaluable trading skill. With a forex simulator, you can learn to identify these emotions and come up with a plan and a routine for how to deal with them. It is better to know the kind of emotions you will face when winning or losing on trades without risking real money.
Create, Develop, And Test Your Trading Strategy
A simulated trading environment is the best place to hone your trading strategy. Funded with virtual funds, common beginner mistakes will not cost you, you can analyse past performance and adjust to transform your strategy into a consistent money-making plan without losing real capital along the way.
Opening A Demo Account
With CFI, you can open your free demo trading account within minutes. Simply complete the short account registration form and you will receive an email with all the instructions needed to install and use the MetaTrader 5 platform as well as details regarding your account.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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