Confusions Related to the Paper Trading Account
You must have heard about the rumor that traders who perform well in demo fail to replicate the result in the live account? Well, this is not a myth because we have experienced this before. Trading is a challenging task but what most people don’t realize is the confusion that surrounds this profession. Not only an investor has to practice the skills to get the results, but he also needs to compete with the rivals. This is a competitive sector where every person is trying to make money. The brokers understand the risks of losing capital and they offer the virtual balance. In these accounts, an individual can simulate live trading without depositing money. This is a wonderful opportunity to know whether a person finds this industry suitable.
The confusion arises when we fail to have the result manifested in the live trading. Despite doing everything traders have done before, the failure keeps on occurring. In this article, we are going to explain this topic and understand why this happens. For the novice, we will also provide advice to overcome this failure.
The sense of failure is not comprehended
First of all, people never perceive the idea of losing capital as long as they are not investing their money. The brokers give close to a million dollars. This fund can never be depleted even if a person wants to. This provides a false sense of confidence. Instead of implementing the learned knowledge, they will simply invest to find out how the trend is going to affect the account. Most investors open micro-account which can be opened for 10 dollars. When they are managing a fund worth millions, losing control is simple. This begins to trouble the Forex investors when they start trading in a live scenario. Every decision affects the balance which can become a headache over time if risk management is not developed.
The solution to this concept is to develop a sense of responsibility before you start practicing. Don’t take this money as a gift but understand and try to make the best use of it. The best plan is to separate the amount that you would have in the live account. In this way, you will realize how decisions are going to affect the live deposit.
Taking the deposit for granted
Most people think they can invest whenever they want. They want to simply reinvest if the fund has been lost. In this way, the mind ignores the importance of deposit. When practicing, the virtual fund is taken for granted. They start implanting all the techniques and lose the money. Yet traders will show no indicators which express their regret. The community must be thankful to the brokers who gave out these free opportunities. In this volatile sector, without practice, there is no chance to survive. Never take the challenges takes in life for granted but learn to accept their importance.
The solution to this situation is the change the mindset and develop a strong basic concept. Learn to embrace every opportunity in forex. This will help to deal with bonuses as you progress in your career. Bonuses can be useful when used strategically. Professionals can grow their deposits by using the resources in the market.
Not using the tools and randomly placing orders
Trading terminals are equipped with sophisticated and advanced tools which can transform the way a person trades. Unfortunately, these gadgets are ignored in practice. When people are trading for the first time, they remember this equipment and implement it in their strategy. The lack of experience results in failure and traders wonder why they could not make money as simply as they had in practice. Don’t keep on placing orders randomly but analyze the trends. Only take risks which has the potentials to rewards.
To overcome this challenge, focus on learning the fundamental concepts. The basis of making a profit depends on simple ideas which are neglected by the market.
