Many brokerage firms offer demo accounts. Demo accounts are a service that allows you to learn how to operate the trading platform and test your trading strategies without risk. Before trading with a real account, you should practice on a demo account until you can profit.
On the other hand, if you use a demo account for too long, you could struggle to transition to a real account. Moreover, since real accounts use one's own money, stress can impact a trader's decision-making. Therefore, mental control is necessary to follow your trading strategy under pressure.
Losses in a demo account and a real account have different mental effects. You will find it much more difficult to cut your losses in a real account and may also lose confidence after a losing trade.
Nevertheless, the trader will eventually need to move to a real account.
So let's consider the steps involved in moving from a demo account to a real account.
When trading in a real account, be prepared to accept the risk of making a loss. No matter how good a trader you are, you will have losing trades.
Start trading a small real trading position to reduce your risk and build confidence.
Make sure you use the same trading strategy in your real account as in your demo account and that you manage risk similarly.
If the results in the real account are poor, take a break or return to the demo account to improve your trading skills.
Change your mindset to focus on the next trade. Instead of dwelling on past bad results, focus on improving your trading strategy.
The key to trading is to find a strategy with an edge. First, understand the patterns and characteristics of the market to build a trading plan. Then, once you have found a profitable strategy in a demo account, execute the same strategy in a real account. Understanding the challenges in a real account will help you in future trades. It can take time to become profitable, but keep a long-term perspective and follow your trading plan.