So now that you know all there is to know about pips, spread, margin, leverage, and brokers; all that’s left is to log in, pop those charts open and start trading the forex market! Right?To get more news about Forex Demo and Real Accounts, you can visit wikifx.com official website.

Yes. Well, no. Look, unless you’re the most humble thrill-seeker in the world, I mean. Then, by all means, you go ahead and enjoy the mild adrenaline rush of blowing all your money on a live trading account. But if you want to make things right, the first thing you need to do is open a demo account and use virtual money before you are risking real money.
In this lesson, we’ll explore the best way to start trading and discuss the differences between a demo account and a live account.
Demo vs Live Accounts
Look, as nice as it would be if we could teach you all there is to know about Forex trading within a week, it’s not humanly possible. Unless you’re a natural-born talent in reading the Forex market and predicting price movements of FX currency pairs, you’ll most likely lose your money quickly if you decide to trade Forex in a live trading environment.

But if you and I are going to have a positive customer-mentor relationship, we gotta trust each other. So I can’t lie to you about you being ready to start trading live here and now. What you are ready for though, is Demo trading.

There are no special tricks here. A Forex demo account is simply a type of trading account offered by many Forex brokers to potential clients and existing traders. By using Forex demo accounts, these traders use virtual money and a risk-free environment to get familiar with the trading platform and the Forex market and to test different trading strategies. That’s the main difference between a live trading account and a demo account. A demo account simply helps you to understand how the Forex market operates and gives you a risk-free start to practice your Forex trading with virtual money and without having to risk your own money.

Benefits of Using a Demo Account in Forex Trading?
A demo account is a trading account that provides a realistic trading environment, with real-life prices, indicators, and all the available tools that a live account has, but without risking your hard-earned money.

When you open a demo account with a Forex broker, you’ll receive virtual money which can be used to demo-trade, practice your trading skills, get familiar with the broker’s trading platform and get a first-time experience of the dynamic world of financial markets. That is the purpose of demo trading.

Demo accounts are a great way to get your feet wet in trading and because it is fake money, you can’t withdraw a penny if you have a winning streak, but equally, you can’t lose your money either. That’s the benefit of using a demo Forex trading account – you get access to a real trading platform, you can follow the market and view quotes of currency pairs and other markets, test a trading strategy, and place orders the same as you’ll do on a live account. It’s basically a virtual trading experience.
Studying is Helpful, but Experience is Invaluable
There’s no shame starting with a Forex demo account – it’s where all the pros first honed and developed the skills that made them into profitable Forex traders later down the road. A demo account is ultimately an educational tool and the educational benefits of demo accounts can’t be denied. Demo trading offers something that simply can’t be taught from just reading, or listening to another trader or a mentor like myself. Using a demo trading account gives a trader a bridge from the theoretical world of trading to the practical one.

This is invaluable in Forex trading as more often than not beginner traders end up burning their first live account, as they fail to develop the necessary skills, trading mindset, and discipline needed to successfully trade on a live trading account. That’s why experts recommend you place 50-75 virtual trades on your demo trading account before you start trading with your real money. Further, with demo trading, you can test a particular trading strategy before you use it on a Forex live account. As a matter of fact, many traders use demo accounts to test their algorithmic automated trading strategies and only then apply these strategies in a live trading environment.

As a rule of thumb, you should use a demo account until you develop a solid, profitable trading system before you even think about trading on a live account with real money! If needed, use a Forex broker that provides an unlimited Forex demo account, which means you can use your demo account with no expiry (even if you have a live account with the chosen Forex broker).
The Final Step – Trading a Live Account
Well, demo account trading could help you to understand Forex market dynamics and in developing your own trading strategy and trading style. But eventually, you do not want to trade on a demo account forever (Which is one of the reasons why many Forex brokers provide a demo account for a limited period of time). So, the final step – once you feel confident enough, forget about demo trading and your “alleged” success as a demo trader and move on to the real world.

Trading live is a different beast altogether. It’s like the difference between sparring against your brother and fighting Connor McGreggor.

There are several differences between trading with your live account and demo trading, but the main factor that makes a significant difference between the live account and the demo account is trading psychology. 95% of Forex traders say that emotion is the main factor that cannot be recreated when comparing the two types of platforms. Honestly, don’t be surprised if you are making huge profits on a demo account from day one. That’s the way it is – trading is a mind game.

This is due to the fact that your money is NOT on a stake while using the demo accounts, and you can think clearly and rationally in a demo trading environment. But cool-headed trades made on a demo account, have little significance when placed into real markets. As soon as you start using live accounts, everything changes. Regardless of how strict your demo trading is, it is impossible to prepare yourself for the emotion attached to having real money on the line.

After all, if there was a way to prevent fear and greed, we’d all be halfway there to be profitable traders. But sadly, there is no secret to success in Forex trading other than patience and consistency. It is all about building a stable base and focusing and improving your trading processes.

The bottom line is – Start with a demo account and learn how to trade the Forex markets safely first. Then, once you have developed your own strategy and trading plan, open a live account with a reputable Forex broker. That’s the right way to start your Forex trading journey.