Demo Trading Account
The Deal With Demo Trading and How to Get a Free Account
|Broker||Overall Rating||Free Demo?||USA?||Minimum Deposit||60s Trades||Review||Visit|
|9.5||$20||X||[include filepath="/../../plugins/logic-button/reviewbtn.php"]||[include filepath="/../../plugins/logic-button/visitbtn.php"]|
|9.4||X||$250||[include filepath="/../../plugins/logic-button/reviewbtn.php"]||[include filepath="/../../plugins/logic-button/visitbtn.php"]|
|9.3||X||$250||[include filepath="/../../plugins/logic-button/reviewbtn.php"]||[include filepath="/../../plugins/logic-button/visitbtn.php"]|
First off, what is demo trading? Demo trading is the process of trading live without real money on the line to ensure that your trading strategies are profitable in the live market. In other markets, it is generally recognized as an essential step to profitability, but in binary options trading, there is almost no talk of it.
This leads new traders to ask whether demo testing is really important, or whether it is just a waste of time. After all, how can you make money when you’re testing “on paper?” Some new traders look at demo trading this way and think, “Well, if I were profitable on paper, wouldn’t I just be upset that I hadn’t invested real money and won real money?” Of course, this is an attitude founded in impatience and overconfidence. What these traders should ask themselves is, “If I lost money on paper, wouldn’t I be relieved I didn’t lose money in real life by investing before I was ready?” Starting out with a binary trading demo account is a wise decision regardless of your level of comfort with options.
For some reason (probably because binary trading is the hot new thing), binary options traders look at demo trading as optional. Brokers often look at it that way as well, and fail to even provide demo testing platforms to new customers. If they do offer demo platforms, they are often severely restricted. There are a few brokers that do offer unlimited demo testing, though, and a number of others that only require an email address, which means you could start a new trial with a new address if you had to.
Binary options trading tends to appeal to gamblers. If you are in this for fun and you are not treating investing as a business, then you do not really need to demo test. If however you are treating your trading as a business, you need to have a business plan and take every aspect of your binary options trading seriously. You wouldn’t sell a new product to the public without testing it first, would you? Likewise, if you expect to profit from trading, you should not use your trading strategy live without testing it first to ensure that it works in real life.
Benefits of demo testing before trading live:
- Learn to use your trading platform properly without losing money because of simple navigational errors and other avoidable mistakes.
- Test your new broker to make sure this is the broker you really want to invest your money with. Does the platform work well? Do orders get executed as you would expect? Does the customer service team respond quickly to your inquiries? Do you have all the features you need? Get answers to these questions before real money is on the line.
- Test your trading strategy live. This is not the same as testing it on historical data. Make sure it is still performing well in current market conditions, and that you are able to make the same decisions in real time you would have made while backtesting. This adjustment can be more difficult than you might think.
- Get a chance to learn how to schedule your trading into your real life before you lose money. It is not uncommon to have a great system which backtests well, but which poses difficulties when you try to use it live. Maybe a lot of your trades fall during your workday, or take place overnight. Demo testing gives you a chance to learn how to deal with the scheduling problems and get them sorted out before you start investing with real money.
Where to Demo Test Binary Options
What brokers offer you the chance to demo test binary options? Here are some of our favorite picks:
- TradeRush. Enjoy trading risk free with a fully functional demo account. You must deposit $200 to use the demo feature.
- 24option. Demo test with $2,500 in virtual funds after you deposit $200 or more to open an account.
- BossCapital. Once you make the minimum $200 deposit you can get a $10,000 demo account set up for you.
- Banc De Binary. Demo trade with $50,000 in virtual funds when you deposit $500 and contact customer service.
- Marketsworld. Demo test indefinitely with $5,000 in virtual funds. No limitations and no deposit required.
How to Demo Trade Risk Free? – You can minimize your risk by only depositing the minimum and refusing any bonuses. That way you can withdraw without having to first trade a certain volume. Our advice is to touch base with customer support prior to making your first deposit and let them know you are considering depositing but you want to refuse any bonuses and have full access to your own demo trading account. If you are willing to make the initial deposit that shows the broker good faith that you are serious about possibly trading with them and not just wasting their time and resources playing around and never deciding to become a real client.
Demo Testing is Essential to Success
If you are a binary options trader, your business is investing. You should be able to understand the concept of investing time and effort into success, which is exactly what demo trading is. Not losing money is often the first step to making money. When you demo test, you save money by avoiding losses you can easily avoid and by honing your strategies so that they are even more powerful. How can you make money demo testing? By looking at the long term.
If you do not demo test, it is basically a guarantee that you are going to fail sooner or later as a trader. The same goes for skipping the step which proceeds demo testing—backtesting. Trading without a well-developed and tested strategy leaves your fate entirely up to chance, and Lady Luck is not a forgiving mistress. In binary options, the house already has an edge on you. There is a gap between the average payout percentages you receive and the out of money rewards that favors your broker. You have to be profitable more than 50% of the time to break even, and even more than that to be profitable over time. That means that to succeed at binary options, you have to find an edge. The path of research and testing is the only route to finding and developing that edge. So demo test first, and then go live when you are ready to beat the house!