Disliked{quote} Hey P You hit on some important points that i'll give you my opinion on and hopefully gives you some direction -Firstly james always talks about small accounts and how most people lose because of small accounts. When a dollar amount on a trade becomes WORTH something you will trade differently. Now I agree with james but also know that if you can trade that account true that it doesn't matter in theory. But in real time most people have trouble with this. Let's for example take a trader who open a $1000 account and risks 3% a trade. That's...Ignored
Now coming to the advantage of trading on a small account rather than paper money....real money though in small amounts brings in some discipline and seriousness to trading. We all need a structure and should bring in a sense of commitment to the craft. We all know this in the software world where the students take learning seriously when you charge some money for that. The biggest advantage is losing the fear of trading with real money. If one is doing a well paid job he can slowly add to his trading account while trading with a micro account. The main thing here is to be able to practice the trade all the time.
The main issue here with a small account many people tend to trade on lower time frames and that results in failure most of the times. It just gets real hard below 4hr. The pace of price movement on smaller time frame simply puts the mind in a framework that tends to give losing trades and with losing trades your confidence tanks and that goes downhill. My bad luck is that when I had capital I did not have confidence in trading and now I have some confidence but no capital. Life throws up curve balls all the time.