All Australian forex brokers should be able to offer you a demo account. It is important that you use the demo account before you start trading on the live market. There are a number of reasons for why you should demo trade before you move onto the live market. These reasons range from honing your trading skills to understanding the Australian forex brokers trading platforms.
What is a Demo Account?
Before you can start using a demo account you have to consider what a demo account is. A demo account is a simulation of the forex market and is offered for free by forex brokers. When you use a demo account you will be trading on a real time simulation of the fore market without the risks involved in live trading.
The Australian Forex Brokers Trading Platforms
One of the reasons why you are going to use a demo account is to determine whether you should use the forex broker. The trading platform that you get with the demo account is generally identical to the one that is used on the live accounts. This means that you can judge how comfortable you are with the platform before you put any money into a trading account.
There are two kinds of trading platforms that you can get. The first is the basic platform that offers you only the minimum features you need to trade. The integrated trading account is the second kind and will have news feeds and other features. You need to determine which trading platform is best for your trading and you can do this with a demo account.
You will also be able to determine which currency pairs a broker offers. As the demo account is a simulation of the live experience you will only be able to practice with the currency pairs that the broker offers.
Testing Without Risks
To become used to the market and how you are going to trade you need to use the demo account. You will not be risking real money on the demo account which gives you the opportunity to properly test your trading strategy and plan. When you do not have to worry about the losses that you could face you can test your strategy more comprehensively.
Of course, the lack of risks can also be a problem when you use a demo account. There are a number of bad habits that traders pick up when they use a demo account. One of the most common is that they divert from their trading strategy. As there are no real life consequences of losses on the demo account this is seen as acceptable. This is a habit that can cause a number of issues when you trade on the live account.
Is the Market Right for You?
The use of a demo account also allows you to determine whether or not the forex market is right for you. When you look at the theory of forex trading you may consider this to be the right option for you. However, when faced with the practical aspects of trading you may determine that this is not the best option.
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