I really dont understand the whole point of people saying that Demo accounts are useless.
No they arent!
The whole notion that you should go ahead and put money in a real account (even a micro account) and then lose it sounds pretty counter productive. Yes you can learn from experience, but it will be a very limited experience. You will hardly be able to place any trades without being stopped out many times. Then you've lost so much money that you have no choice but to either put in more money or switch to demo.
Then calling it "tuition money" for learning to trade makes no sense either. So you have $500 in a mini account and you blow it all in 20 trades. Then what? 20 trades in nothing at all. On top of that, you pay the price of a damanged psyche.
Consider this analogy: your kid wants to learn how to drive a car. Would you sit with them in the car (maybe with Dual control perhaps?) and teach them or would you let them take the car out for a spin in the hopes that once they wreck it a few times they will learn how to drive?
Assuming you take it seriously, a demo account is useful because:
1) You can devise and test strategies on it.
2) Find out the kind of trader you are...swing, day or long term etc
3) Find out what works for you.
4) Iron out any stupid mistakes you make. Come on, we've all been there...pressing sell instead of buy?? Sound familiar?
5) Learn how it feels to win money even on a demo. How many here have honestly played a demo account, made money on it and then not been careful enough to preserve it? <--- Doesnt this sound like the beginnings of money management?
6) If you cant make money on a demo, then how are you supposed to make money on a real account?
I think the whole idea that demo's are useless has been derived from a few idiots how start up a demo and then randomly buy/sell every currency in sight and somehow manage to make a lot of money on the demo. Who cares about that? You're cheating no one but yourself of a valuable learning tool.
Please dont turn this thread in to a bashing hot spot between the newbies in pros. We can all learn here.
No they arent!
The whole notion that you should go ahead and put money in a real account (even a micro account) and then lose it sounds pretty counter productive. Yes you can learn from experience, but it will be a very limited experience. You will hardly be able to place any trades without being stopped out many times. Then you've lost so much money that you have no choice but to either put in more money or switch to demo.
Then calling it "tuition money" for learning to trade makes no sense either. So you have $500 in a mini account and you blow it all in 20 trades. Then what? 20 trades in nothing at all. On top of that, you pay the price of a damanged psyche.
Consider this analogy: your kid wants to learn how to drive a car. Would you sit with them in the car (maybe with Dual control perhaps?) and teach them or would you let them take the car out for a spin in the hopes that once they wreck it a few times they will learn how to drive?
Assuming you take it seriously, a demo account is useful because:
1) You can devise and test strategies on it.
2) Find out the kind of trader you are...swing, day or long term etc
3) Find out what works for you.
4) Iron out any stupid mistakes you make. Come on, we've all been there...pressing sell instead of buy?? Sound familiar?
5) Learn how it feels to win money even on a demo. How many here have honestly played a demo account, made money on it and then not been careful enough to preserve it? <--- Doesnt this sound like the beginnings of money management?
6) If you cant make money on a demo, then how are you supposed to make money on a real account?
I think the whole idea that demo's are useless has been derived from a few idiots how start up a demo and then randomly buy/sell every currency in sight and somehow manage to make a lot of money on the demo. Who cares about that? You're cheating no one but yourself of a valuable learning tool.
Please dont turn this thread in to a bashing hot spot between the newbies in pros. We can all learn here.