As a Forex trader, you will hear several professionals advising you to demo trade till you're skilled enough to participate in live ones. Practice being the first requirement in trading, makes demo trading seem indispensable. Real-time Forex trading in Indonesia is scarily volatile; traders lose thousands of dollars within minutes when not careful! To survive in a field like this, you need to be battle-hardened. While demo platforms do provide you with an environment to learn how trades function, they don't equip you to face the harsh environment of real-time exchanges.
Here are 3 reasons why demo accounts impact the live-trade mindset:
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| Demo Trading vs Live Trading Account Psychology |
1) Trading Real Money is a Different Experience: On a demo account, you can start off by trading a million dollars. These virtual platforms equip you with limitless capital to facilitate a practice experience without any bounds. This environment, however, turns out to be counter-productive. In a real-time Forex trade, you won't have a million dollars! Working with a maximum of a few thousand, you will have to play it safe and protect your capital. Forex demo trading will make you used to deal with unlimited capital, and when you move to live markets, working with bare minimum will take a heavy toll.
2) Live Trades House Unforgivable Volatility: The reason Forex trading is challenging is because winning despite of its immense volatility it truly difficult. To get accustomed to its erratic environment takes time. Only when you participate in trades can you learn the various nuances of this field, what is needed to achieve success, and how to succeed. Demo platforms will only equip you with the knowledge of trading platforms and basic trade movements. Practicing on Forex demo accounts and moving to a live-trade will leave you immensely unprepared and unequipped to deal with the vastly chaotic nature of each exchange!
3) There is No Fear of Losing in Demo Trades: What truly drives and guides a Forex trader to play it safe and protect his investment, is fear. The fear of losing money keeps a trader from investing unnecessarily. Demo accounts are designed to provide a risk-free environment, where there isn't an ounce of fear! Since these are practice platforms, traders have complete freedom over everything. When you start live trading, you will see the various ways money can be lost, in Forex. This is one of the biggest drawbacks of Forex demo trading; it doesn't equip you enough to deal with losses.
Foreign exchange might seem intimidating, especially if approached without practice, but it is an incredibly profitable venture! Aided by the right broker, seeing consistent success is easy. Call WesternFX today, and avail our world-class brokerage! With our experts by your side, even on Forex demo accounts you will learn the real-time implications. Master Forex trading in Indonesia today with us!
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