Most question beginner is how to use a demo account in forex trading?. Experienced traders always advise beginners to practice their skills using a demo account. Why is this important? Because forex trading is not as easy as reading a theory of a trading system and strategy.
There’s a lot of education to learn about forex trading, beyond just buying and selling. There are several important factors that beginners should study in order to reduce the high risk in real accounts.
What’s a demo account?
Simply put, a demo account is an account type designed to simulate risk-free trading under real market conditions.
On a demo account, traders will see real-time prices just like what happens on a real account, but this demo account is the main difference is that it only uses virtual money, aka not real money.
Virtual money in the demo account is provided by the broker, and traders using the demo account can make buy and sell transactions just as they trade on the real market. Even if a margin call occurs, the trader does not lose anything. Not like borrow money, you don’t need to pay back the loss to the broker.
How does Demo account works
A demo account can be said as a trading training tool, where a trader can simulate a trading strategy, before using a real account.
Especially beginners, it is important for them to learn the features of the trading platform, apply the trading methods they have learned.
Almost all brokers provide demo account options in their trading platforms. It becomes a strategy to attract traders to try forex trading risk-free.
To use the demo account, go to the broker that provides access to the demo account, for example, you want to try the TenkoFX trading platform, go to the site and click open demo account.
You need an email address to get started and enter your password. Then you just need to follow the instructions to get your demo account number and your demo account details.
Why demo account is important?
Demo accounts are very important for traders. Forex demo accounts will provide very real lessons about online forex trading especially for beginners.
For intermediate traders, a forex demo account is useful for testing a trading system, before traders use a real account. Demo account good to practice analysis and execution of trades.
Beginners and experienced traders can take advantage of the forex demo account to freely test the trading system, without fear of losing if they make a mistake.
For traders who are still exploring or looking for a broker, they can register for a forex demo account to learn how the technical performance (server, speed, etc.) of a broker is.
Is a Demo account free?
In general, demo accounts are free. Traders do not have to pay any amount of money to use the trading platform. And demo account are free to use all of the available trading tools. Be it forex indicators, or trading robot software.
It’s just that there may be differences in policies regarding demo accounts at each broker. The difference can be from the amount of capital that is the minimum deposit. Some give a demo account as much as $50k, but some give a lower one.
Another difference is the duration of using a demo account, a good broker gives access to a demo account without a specific time limit. However, some brokers may only give you the opportunity to practice a demo account for a minimum of six months.
Are forex demo accounts accurate?
Forex demo accounts are not always accurate, there are several factors that affect them. The trading server differences between demo accounts and real accounts cause demo accounts to not always be accurate.
On a demo account, you may not face slippage, but later when using a real account you may face a slippage challenge.
Another difference between demo vs live is about psychology. works on a demo account, can’t involve emotions, so there is no anxiety, panic, and so on.
Are forex demo accounts rigged?
Do brokers cheat traders with demo accounts? In essence, it is not. The quoted price displayed in the demo account and real trading account is the same. However, there are several reasons why the experience on a demo account and a real account may be very different.
If classifying these differences are as follows.
Your emotion feeling
This is a fundamental and important difference, when working on a demo account, which only uses fake money, you don’t feel any pressure. But when working with real accounts, emotions will interfere with the way you make a trading decision.
It possible when you work with a demo account getting a good results. But could different in a real account. The results may bad because you are no longer as disciplined as when working with a demo account.
Loss in the demo is not real
When working with a demo account, the losses you suffer are not real. Even if you face consecutive losses, you don’t feel like you are losing money. Bu working with a live account, the losses you see are real. Meanwhile your hope is to make a profit.
Order in demo always be taken
Some experience of traders share experience that on demo accounts all orders are always taken. You never encounter any strange experiences in demo accounts. In addition, the initial capital for your deposit is usually large, which typically affects the trading results.
When using a real account, you may have a strange experience that causes losses. But depends on your broker. Because there are brokers want to cheat on their traders.
Demo account not always accurate
Not all demo accounts are accurate, this can depend on the broker you choose which can provide a different experience from other brokers. Some brokers may create an easy environment in a demo account, so you will quickly switch to a real account.
Open demo account in MetaTrader 4?
You can register for a demo account through the broker’s official website to get detailed information on account numbers, passwords, trading servers, etc. After that, you install the platform and log in using those details.
You can also register a demo account via Metatrader 4 directly. The steps are as follows:
Run Metatrader 4
Run the Metatrader 4 platform on your computer, if you haven’t already installed it, download and install it first. Go to the site of your broker and then download and install the platform. You can also download the platform on the official site of metatrader4.com.
Enter detailed personal information
- Click menu “File” on the top left bar of the Metatrader 4 platform. After the dropdown menu appears, click “open account”.
- Select the trading server for the demo, by highlighting it. Don’t choose the wrong trading server, if you highlight the real trading server, it will take you to open a real account.
- Click the new demo account and click “next” to continue.
- Fill in the required details, name, email, telephone, account type, leverage, deposit. Then check box I agree to your newsletter, then click “Next”
- After that, a window will appear that provides detailed information on account numbers, passwords, investor passwords, and leverage. Save the details by copying and pasting in a notepad.
- Click finish you will automatically login to Metatrader4 with the demo account you just created.
- You can also open a demo account via the Metatrader4 mobile platform on your mobile.
How to open a demo account in metatrader 5?
How to open an account on Metatrader5 is more or less the same as opening a demo account on Metatrader 4.
You can download the platform first on the download page of your chosen broker, or go directly to metatrader5.com and start from there.
- Install and run the metatrader 5 platform, click on the menu bar “File” continue with “Open an account”
- If you download the platform from your broker, you will usually be directed to the registration page. If you download from the official metatrader5 page you are directed to find a broker. In the search box you can type the name of the broker of your choice. If list broker available. It will appear in the search results. Not all brokers use Metatrader5, so maybe you are looking for a broker that doesn’t appear in the search because it doesn’t use Metatrader5.
- After you find the broker, then click “Next” and a new window appears, click “Next” to continue registration.
- After that you will be directed to the demo account registration on the registration page of the broker you choose, then follow the instructions to complete.
- Fill in the details on the registration form to complete and get your account details. With your account number and password you can continue logging in on the Metatrader5 platform.
How to open a demo account on Tradingview
Tradingview is a social trading platform that offers an intuitive support for multiple brokers. You can take advantage of a demo account using the Tradingview platform in two ways.
Use paper trading
You can register for Tradingview for free, but to be able to access all services you must upgrade your account for a fee.
Below the chart click “Trading panel” then find “Paper Trading”
Then click Connect to continue, there will be a deposit of `100,000 USD as an account balance for you to start demo trading.
Use broker demo account
This is the second option to use a demo account, some brokers already support Tradingview, such as Oanda, Forex.com, and many more, you can register a demo account with these brokers on website and use detailed login information through the Tradingview trading panel by clicking on the broker you are using.
How to use demo account forex?
For those of you beginners using a demo account is to understand how to use the trading platform. You can for free without risk trying to open orders by using market orders or pending orders which are also known as limit orders.
On the Metatrader platform you can add indicators to your chart by selecting the available indicators. To start click “New Order” on the top bar of the platform then you can choose buy and sell instant. Even if you lose, it doesn’t matter because it’s just fake money.
So you are free to explore how to use the platform on a demo account without the risk of losing money.
Using the Tradingview platform you will get a different experience compared to Metatrader. There are more indicators available as analytical tools.
To start opening an order, click on the price quote in the upper left corner of the chart. It will bring up the order page window, you can switch from Sell to Buy by clicking the appropriate option. There you can use market orders, limit orders and stop orders.
How long Demo account forex?
There is no time limit for you to practice using a demo account, but some brokers may make different rules when you use a demo account.
For example you can only use a demo account for a month and have to create a new account again to try again. The company made these rules so that you immediately go to a real account.
By using Tradingview Paper trading you get longer access to practice your skills. How long does it take to practice on a demo account, many suggest at least six months. The reason is that most traders experience account failure or margin call before six months.
Duration does not guarantee you will be successful on a real account, but with a long duration, you can measure your ability to analyze the market, and manage your funds.
How to select leverage in the demo account
Actually this also depends on your broker’s policy, each broker may set a different standard of leverage. You can choose the leverage according to your needs. Although the broker offers leverage of up to 1:1000 but you must understand how leverage works, because high leverage can backfire on your own account.
If you have low deposit amount, choosing high leverage will increase the odds. So when you try a demo account, it’s best to have an estimate of your deposit amount later on a real account. If you are ready with $1000 then a low leverage is enough to prevent over trading for example 1:30, or a high of 1:100.
How to reset demo account mt4
On the Metatrader 4 and 5 trading platforms you cannot directly reset your account. For this step you should go to contact your broker and ask to reset the account. Later your broker will reset your account to zero.
You may have to always be active when practicing a demo account, because if you don’t log in for two weeks, your account will expire.
If you use paper trading from Tradingview, it allows you to reset your account by clicking on paper trading and selecting reset paper trading account.
You can choose a number of account balances that you will use to start paper trading again by writing the amount in the box provided.
How to reset demo account mt5
It’s the same as you want to reset the account balance in Metatrader 4. Maybe you want to use $200 funds to test a robot, then how, because maybe you have previously created a demo account with $ 5000.
There is no way to reset the account balance, but you can create a new demo account and fill in the amount of deposit you want.
How to switch from demo to live account on mt4
You may already have a live account, which is a real account. But on the other hand you are trying a new trading strategy, or a new robot software.
When you see a good opportunity on a currency pair, suddenly you want to switch demo account to real account. How to? It was easy but it took a few seconds to login to the live account.
- You go to “Navigator” in the window on the left bar of your platform, if it is not already there call it by pressing CTRL+N.
- Double click the trading account number you want to log in, it will bring up the account login window. Then click login to continue. A few moments you have logged in to your live trading account.
- You can also switch accounts from the “File” menu and click “Login to trade account”. It will displaying the login window. select the account from the dropdown menu that has saved your live account information, click on it and click login.
The first method is more time efficient than the second method.
However, you must remember to check your trading volume when opening a trading position on a live account after switching from a demo account. Because maybe when on a demo account you use a volume of 1 lot, and when on a live account you use 0.1 lots, if you are not careful it will hurt you quickly.
How to switch from demo to live account on mt5
It’s the same way by using Metatrader 4 to switch demo accounts to live accounts as mentioned above. Use the “Navigator” menu and double-click the account you want to log in to. Finished.
The demo account can be used to forward test a trading robot that you are interested in using on a live account. Some robots may only be designed for demo accounts and must purchase a license to use on a live account.
Practicing with a demo account can also increase your love of the business of trading in financial markets. Even though it only uses fake money, some brokers may offer demo trading contests with attractive prizes.
Note: This article is informational only and does not constitute investment advice, forex, crypto and CFDs are risky trades, each investor is responsible for his/her investment.