July 29, 2021, | AtoZ Markets – Demo accounts are a very valuable tool when trading the Forex market. That is why investors must choose very well with which broker they want to work in order to obtain the best results. In the United Kingdom, the regulation of financial markets is very strict and controlled, and this helps operators to have peace of mind when handing over their money. Always do a complete investigation of the broker you will use and their demo account.
What Is a Demo Account Forex?
A Forex Demo Account or trading simulator is a very important learning tool for all those who wish to participate in the financial markets. The Forex Demo account allows the investor to operate in real-time and under the same quality standard as those financial instruments in which they are interested. The first thing you should know is which broker you want to work with and for this, you must make sure that they have their own demo account. Many brokers offer multiple platforms, for example, MetaTrader MT4 and MT5, that are the most popular. While each platform may work and look slightly different, most offer roughly the same features. These features include currency quotes, prices, charts, technical analysis tools, news feeds, trading history, drawing tools, and functionality to buy and sell currencies.
What Is the Proper Way to Trade a Demo Account Forex?
It is important to choose a demo account that is comfortable and reliable based on personal needs. Language is a central issue, in many cases not only in terms of the user interface, so it is convenient to choose one that provides help in a language that you speak fluently. Some platforms have more features than others. For example, some of them have built-in fundamental analysis tools. That may be important for a long-term investor, but it doesn’t matter for a short-term investor. It is always recommended that your demo account has a balance as close as possible to the balance that you would be able to invest in a real account.
On the other hand, it is necessary to practice and knows perfectly what is the function of each button or module in your demo platform. Familiarize yourself with each function designed by the broker and use and customize the charts according to the colors and time frames you need. The main mistakes we make when we operate the forex demo account is performing operations without control, taking too many risks, opening positions without trying to build and your own trading strategy, and not analyzing what works and what doesn’t in your trading system. All of this can quickly destroy your demo account balance, or what is worse, lead you to waste your time without learning anything and create bad habits that you can repeat on a real account.
To be able to create your graphics the way you want, go to the screen, right click with the mouse, and go where it says properties. There you can change the colors and objects you want to see.
How to Execute Orders in Your Demo Account Forex?
It’s a good idea to always place many orders of demo trades on a platform before trading or real money because it’s necessary to master the specifics of order entry.
A market order is a provision that the client gives to the broker to buy or sell a financial instrument. The result of the execution of this order is the conclusion of a sale transaction.
The price of the transaction is determined by the type of execution which in turn depends on the type of instrument. Generally, the purchase is made by the offer price (Ask), while the sale is made by the ask price (Bid). The types of orders in the forex demo account that are handled are:
- Market Execution
- Pending Order
The first one is an instantaneous execution, while a pending order is an instruction given by the client to the brokerage firm to buy or sell a financial instrument in the future under specified conditions. There are the following types of pending orders:
- Buy Stop
- Sell Stop
- Buy Limit
- Sell Limit
Know Your Forex Demo Account
Apart from these types of orders, there are so-called “Stop Loss” and “Take Profit” orders. The Take Profit order is used to obtain profits when the price of the financial instrument has reached the level estimated by the trader. The execution of this order leads to the complete closing of the position. When checking the conditions of this order for long positions the Bid price is used (the order is always placed above the current Bid price), and when checking short positions, the Ask price is used (the order is always placed below the current Ask price).
Meanwhile, the Stop Loss serves to minimize losses in case the price of the financial instrument starts to move in a different direction. If the price of the symbol reaches this level, the position is closed automatically. When checking the conditions of this order for long positions, the Bid price is used (the order is always placed below the current Bid price), and when checking short positions, the Ask price is used (the order is always placed above the current Ask price). The success of your forex demo account is in learning how to minimize losses and manage profits.
Trading Demo Accounts Forex
It is very important that when we open our Forex demo account we have the peace of mind that our money is in a safe place. Therefore, it is very important to take into account all these factors when choosing where we will deposit our funds:
- Verifying the honesty and commitment of the broker
- The safety of customer’s money
- The customer feedback and support to the investor
- Broker regulation
- Withdrawal process
- Fees and commissions
Important Note: Mr. Investor, whenever you open your forex demo account, check out this link to find out which ones are the best.
Practice Trading with a Demo Account Forex Now
Now that you know which is the best Forex demo account for you, it is time to start participating in the forex market. Do not wait any longer to open your demo account and learn to trade all the instruments that these electronic platforms have to offer you.
It is just as important that your trading system is profitable as it is consistent and you can make profits in a sustainable way over time. If this does not happen in a demo account it is unlikely that it will happen in a real account. Even if you take the demo as if it were a real account, the psychological pressure that you will have when operating with your own money will always be greater, mainly due to fear or greed. If the demo results are still not adequate, you must act patiently, try to expand your knowledge, and improve your trading strategy.
The Best Demo Accounts Forex in the UK
Most UK forex demo accounts are designed like live trading accounts. The process of opening a demo account will depend on the forex broker. On some platforms, you will need to open both the real and the demo account while others run them as separate entities. On the other hand, in the UK the only significant difference between real and demo accounts is the currency used. A demo account is free and uses virtual funds that have no real value. However, to start trading on a live account, you will need to deposit money. In the meantime, if you are wondering how long I can use a UK forex demo account, the answer is that this will depend on the broker. Some offer a 30-day free trial while others give unlimited access.
The best forex demo accounts focused on the trading platform features, ease of use, and customer service, has given us the following list in UK:
1. AxiTrader MT4 Demo Account
This forex demo account has 30 days 100% free and is available with Axi formerly AxiTrader. This broker offers access to MetaTrader 4 and $50,000 in virtual cash with no minimum deposit requirements to open an account. The most unique feature of Axi’s demo account is the inclusion of a dedicated account manager in addition to their 24/5 client support. Axi customer support is award-winning and highly valued, as it means you can ask trading questions while you learn about forex trading and develop your trading style.
2. Ava Trader MT4 Demo Account
AvaTrade is a well-established forex and CFD brokerage firm founded in 2006 in Ireland under the name AvaFX. It rebranded later to improve service delivery and has spread to other parts of the world. It is regulated by the Central Bank of Ireland and other financial authorities such as the Financial Conducts Authority (FCA) in the UK.
- Impressive interface
- Offers a wide range of currency pairs
- Easy and simple to open a free demo account
3. IFC Markets
- Order execution – Instant execution
- Pricing – Narrow, fixed, and floating spreads
- Size – trade with any volume size
- Qualified online support in 18 languages
- Customer Support- 24 hours a day
A demo account is a great way to gain a deeper understanding of online forex trading. Also, it will enable you to familiarize yourself with your preferred broker, how it operates and its key features that can help you trade successfully.
Even more importantly, a demo account will help you try out strategies that you can apply in real trading.