In this article, you will learn how to properly use a demo account to prepare risk-free for live trading.

Let's get started.

The demo account allows you to practice your knowledge of the Forex market completely free of charge and risk-free.

Don't even think about trading with real money before testing your skills on a demo account.

The demo account has the same capabilities as the live account but with virtual funds. In demo you also win and lose, but virtual money.

You're not risking anything!

How to properly use a Demo account

The main point is to open a demo account with the same amount of virtual funds that you plan to use in your real account.

Open a demo account with one of the best brokers in the world.

If you plan to invest $5,000 over time, avoid opening a demo account with $200,000. Doing so could lead to trading with larger volumes than your actual investment, creating habits that won’t align with your live account.

Use the demo account to explore the possibilities of the trading platform

Keep in mind that demo and live trading are done on the same platform. Get to know in detail the buttons, indicators, and tools offered by the trading software.

Understand where trading volumes shift, how to set Stop Loss and Take Profit, and more. A common mistake is failing to adjust the trading volume when switching from a demo account to a real one.

Test different strategies and trading styles

There are various trading styles in Forex, so it's important to find the one that fits you best. Consider your available time, your initial investment, the results you're aiming for, and, most importantly, the level of risk you're comfortable taking.

There are hundreds of strategies, even thousands! Some of them are better than others and there is a logical reason for that. Choose a strategy that suits your style and behavior.

You can find out how to start trading in the financial markets from the article below: 

>> Forex Trading: A Complete Guide for Beginners

Avoid spending too much time on a demo account

As strange as it sounds, you shouldn't spend a long time on a demo account. There is one very important aspect of forex trading that few traders consider, called the psychology of forex trading. A trader can only develop the right psychology during live trading.

I'm not suggesting you deposit your entire trading amount before you're fully ready!

I believe it's better to start trading with real money, even if it's a small amount, before funding your main account. Your approach to trading changes significantly when you know you're dealing with actual gains or losses.