Demo Trading is fearless emotion free virtual trading where Live Forex Trading is consists of real money with a lot of emotions involved. There is many people complain that they traded demo account successfully but failed in live accounts. WHY?

For example, take an instance how it works actually. Demo Forex accounts are automated all execution while live accounts are only automated up for some certain currency pairs. If you are trading on a Live platform, each your order is monitored by the manager, who has enough knowledge & experience in trading and he controls all the aspects very accurately. Live Forex platform is online controlled and monitored by an Expert Forex Trader.Sometimes you may see this message “Simulated demo conditions may be differ from real conditions, and traders should not necessarily expect the same results from live trading.” Let’s say the market is very volatile after NFP news release. You have request a price in a trade order. A forex demo account would execute the price requested. However in Live Forex trading, the broker then tries to execute this price of real bank quotes. By this time, which can be within a second, the price is no longer available. In this situation, slippage occurs when the broker executes your order at a price that is NOT within a pre-specified and acceptable “trader’s range”.

Therefore, with any forex broker, your entry price in the market under live trading conditions may be at times be significantly different from those made under the demo environment. The issue is that LIVE Forex trading will always incur higher transaction costs than reflected by demo trading results. Accepting this fact, the trader should then incorporate higher costs during the evaluation of his or her demo performance in preparation for live trading. In Demo trading you will learn basic, how to use the software, how to use indicators, how to make order entry, confirm your strategies etc. In Live Trading you will see the fundamental difference. Simply you would never do the same things which you tried in Forex Demo versions. If you have never traded live, there is no way to know for certain how emotions will affect you.
Despite trying to limit emotions, we are all human and cannot escape them. When you switch from a Forex Demo account to trading with real money, expect a sensation in your gut. There are a few approaches you can subscribe to in dealing with emotional factors.



Source by Helmut Renner