FOREX >>> Practice Accounts and “Going Live”

Question:

Hi ZL,

I am looking to nurse my small practice accounts into larger accounts gradually. I am using the Forex practice accounts. Many times I have made mistakes and decimated my small practice accounts, which tells me that I am not ready to do real trading with these accounts. How would you suggest that I nurse these smaller accounts into larger accounts? Thx

.......... from Belinda

Answer:

Hi Belinda,

I have two points for you to consider. The first is that when you trade practice accounts, your mindset is different than when you trade with your hard-earned money. You tend to take more and greater risks with play money, which is good. Aside from teaching you the mechanics of trading, practice trading teaches you about taking risk. So, take your time and don’t worry about losing.

Having said that, in order to stop losing, you have to teach yourself a new mindset when trading practice accounts. You have to move to the other extreme and become more conservative, take less risk. Make smaller trades with tighter targets. Slowly build up your practice accounts with small profits. Teach yourself to think as if it were your money on the line. It will take time, but you can do it. When you consistently start taking small profits, you might well be ready.

The second point is that at some point you will have to drop the training wheels, if you want to trade. Eventually, you will have to test your abilities with real money. The time may be sooner, or it may be later. Either way, you will know the time because you will “feel” the confidence to make the move. You will know, and until you know, keep practicing will your small accounts. Keep in mind, when you do “go live,” stay conservative, even if it means taking small losses.

The one thing to remember is that the only difference between trading practice accounts and real money is you, the mindset you bring to the game. This, my friend, will prove to be the difference between success and failure, assuming you do all your work and learn how to trade, assuming your personality and emotional makeup “work” in the trading world.

Trade in the day; invest in your life …

Regards,

ZL