You’re probably here as are new to trading and wondering when to make the leap from practice to real. To know when you should move from a demo trading account to trading real money. Moving from demo trading to real money is different for everyone, but we’ll help if highlighting the key things to consider in your own, individual journey.
After all, every successful trader has been where you are before!
So, you wish to trade but you’re afraid of losing money because you “just don’t know” how to do it? Or if you’re “ready”? Do you prefer to spend your hard-working cash on buying goods like more and more clothing or many pairs of shoes for your only two feet?
Girl, if you’re reading this, you probably want to be richer, right? Do you know that this fear of trading can be overwhelmed by a Demo trading account? If not, start by signing up for a demo trading account like the ones in eToro or Plus 500, follow the hints below!
In this article, you’ll learn how to change from your demo account to a real account and how to know when you’re ready to trade real money!
How is Demo Trading different from Real Trading?
The main difference between Demo trading and Real trading is money. You don’t actually have to have money to trade in demo accounts since they are just a “test” account. Demo trading is like when you’re into someone but it’s just a summer crush: Real trading is like a marriage; you can be happily ever after but it can also become your worst nightmare in the long run.
There are some other slight differences between them. The demo trading vs real trading dichotomy is seen when you actually buy your first stock in the market.
Some guys have studied demo trading and how it differs from real trading, even when using the same strategies, home brokers or buying the same stocks. Here are the aspects that are quite different between them:
- Your mind works differently – when it’s your real money on the line, you don’t think the same! We tend to be more careful when trading in real accounts, that’s why transition may be hard.
- Slippage – in real life, the time between your offer and the actual buying can influence the value of the share. This doesn’t happen on demo.
- Spread is often different – the demo account’s spread makes you think you would profit more than you actually do in real account.
“Am I ready?”
We know that trading with a Demo account is like playing a game and having fun with it. However, this game may seem boring if you play it for a long time – after all, you already know the rules and now you’re ready to move to the next level: from demo to real account!
There are a few tips to help you know that your heart is ready for this new love adventure called Real Trading:
- A reliable method is to look at win percentage and trading profit – if you have a rising and profiting percentage in demo, try and go for it in real!
- Profit per trade – this is a bit risky because you might feel like you’re in the middle of a bet, but if you start slowly, it may work.
- Make the choice by heart – summer love or a steady relationship? It can be up to you, and we’re here to help.
For how long will I be Demo Trading?
It depends. Could be weeks, could be months, could be years. There is no right time – remember the comparison I made with marriage: how do you know for how long you’ll be dating until that person proposes? We don’t know unless we make our move ourselves.
Being ready to trade for real is like getting married. Some people jump in, some people date for years. Others never make it.
We recommend that you at least do as much as possible beforehand to avoid losing money.
Following the tips of the topic before this one will help you a lot. And also it’s better not to follow the ones given in the topic below unless you are in a huge hurry – which we hope you’re not!!
Tips to hurry trade-readiness!
- Skip demo but start small – you can learn the process and discipline directly in real accounts, but you must start small! In this case, you’ll be already trading with real balance, so you won’t have the problem in switching
- Trade the same in demo as you would in real – you won’t learn anything if you risk money in demo that you won’t be able to risk in real trading – there are websites where you can trade with a very low balance, like eToro, and this might help you.
- Testing strategies – if you want to test something new, do it in your Demo account first!
- Trade frequently – trading is all about pattern. See your averages and performances in lots of trading to see if it is safer to trade a larger amount of money.
- Increase the size later – don’t believe in a miracle trading as you don’t believe in a miracle diet! Learning control now is important, as otherwise, you’ll zero out from a bigger pot if the lessons were not learned in demo or small scale real.
- Know and practice your trading rules
- Finally, follow your instinct on when to move from a demo trading account to trading real money
Finally, moving from demo trading to trading real money
If you follow our trading tips, these will be your sweethearts for the true long-lasting love that is Real trading.
You can learn how to reduce risks and use our tips to know when you’re ready to trade real money!