If you wish to start forex trading you’ll likely be looking at a forex demo account. Have you considered a mini forex trading account? Could it have advantages over the demo? A mini trading account gives you the opportunity to trade with real money in small amounts so that you could work with only a small starting fund. With most brokers, the lot size of a mini trading account will be just one 10th of the lot size for a standard account, so you’re risking a lot less. Jump straight to the live trading through a standard brokerage account. Don’t try this unless you’ve years of experience in comparable trading environments e.g.
Stock trading. Start live trading with real money, but use a mini forex trading account. Most brokers ask for a minimum investment of $250. You might find brokers who’ll let you set up with even less, but frankly if you don’t have $250 to spare then you probably shouldn’t be trading. Here you can select up trading skills without using any real money. The idea is that you’ll switch over to live trading when you’re making consistent profits in the demo account. Most beginners choose option 3, the forex demo, because they feel more confident with money to trade on-line for some time first.
It also gives them the opportunity to try out different systems and strategies. The problem with this is that if you keep switching from one system to another in a demo, you’ll never learn how to stick to one system consistently. The fact that it’s not real money may also give you a false sense of security. Utilizing a demo account might encourage you to take risks that would make you uncomfortable in the real market. So in fact what you learn in a forex demo isn’t always useful whenever you switch over. You can have learned to profit consistently using medium to high risk strategies that will yield you a lot of stress whenever you try them with real money.
Stress around risk usually leads to bad decisions and strategy hopping where you’re all of the time changing or tweaking your system. You’re virtually certain to lose money if you begin doing that. Consequently it might be better to begin with a forex mini trading account, using real money almost at once. Just use the demo for a few trades in order that you see how it works.