Forex dummy account

Are you a beginner looking to start demo trading but afraid of market risk? If yes, then here is an amazing way to start risk-free trading. You just need to open a Forex dummy account; how, where, and when will be discussed below. So stay tuned. 

What is a Forex Dummy Account?

Forex Demo account or dummy account is a facility offered by a trading platform or broker that enables traders to trade without risking a single penny. 

In currency trading, traders speculate on the rise or fall of currency pairs and trade accordingly. The speculation may go right or wrong, and as a result, you can make a profit or even lose. 

However, with a new trader without any market knowledge, the chances of loss are high. That’s the reason they are afraid to enter the forex market. 

In order to increase the number of participants in the forex market, the trading platform provides the facility of dummy forex trading. A demo account allows traders to trade with virtual or false money with real market conditions. 

forex demo account

In this way, novice traders can master forex trading without staking their hard-earned money. So that they can make more informed decisions while trading real accounts with real money.

How to open an FX Demo Account

You must be thinking of how to get started with trading demo accounts. Here is a simplified step-by-step process for beginners to start dummy forex trading:

Research & Analysis

The first and foremost step that most beginners skip is research and analysis. Many forex brokers and trading platforms provide forex trading trial account facilities. 

However, a trader should organize proper research to select the best Forex demo account. One can reference review sites, previous customer reviews, and social media presence to check the platform’s credibility.

A quick glance

Bollinger Bands is a popular technical analysis indicator developed by John Bollinger in the 1980s. It is used to measure valuable market insight.

There are three bands in bollinger: Upper, lower, and middle. The middle band represents the simple moving average of a particular range while the upper and lower band represents the standard deviation of the data set.

Bollinger bands are used to determine volatility, breakouts, price reversals, entry, exit, support, resistance, overbought, and oversold conditions.

  • Learning
  • Multiple Confirmation
  • Be aware of false signals
  • Be Patient

Broker Selection

After analyzing some platforms, it’s time to choose your ideal broker. Numerous brokers offer free demo trading account facilities. A trader needs to check different factors to select the right broker. 

It includes education resources, research reports, economic calendars, fundamental and technical analysis tools, and many others. In addition, some brokers allow the facility of demo accounts for a limited amount of time and even charge fees. So, select the broker after considering all these factors.

Registration & Verification

Generally, with a reputed broker, registration is a must even for opening a demo account. However, in registration, they ask for simple information, including name, email address, contact number, and country name. 

Meanwhile, they also ask for KYC documents, such as identity proof and address proof. Some new traders avoid opening accounts with these formalities. However, these are important for clients’ protection.

Starting Demo Trading

Once you are done with all formalities, it is now time to start trading. Remember to make the most of the use of the demo account. Use multiple trades using different trading strategies and try different technical analysis indicators. 

Select a currency pair according to your interest, identify market opportunities, and start placing trades. When you feel that you have learned to trade, you can switch to real accounts from demo accounts.

Pros of Forex Dummy Account

Many traders find demo accounts of no use; especially experienced traders find them useless. However, that’s not true at all. So here are the amazing benefits of the Forex demo account for beginners and professionals:

Learn Complex Concepts

Trading currencies requires knowledge of different critical concepts, and the best way to learn them is through demo accounts. Traders can master complex concepts like leverage, spread, size, pips,  and lot size from demo trades. 

In addition, there are different forex orders like market orders, limit orders, stop loss, and trailing profit orders. So, demo accounts will help you in mastering order management and execution. 

how to trade in demo account

Get friendly with the trading platform

For trading in currencies with a broker account, you need to open a trading account. A trading account is where you place or execute a trade. You may have heard of trading platforms Meta Trader 4, Meta Trader 5, Web Trade, and C Trader

These are the most popular platforms globally. Almost every trader has an account on any one of them. So, with a demo account, you will get to know these platforms’ features, functions, and workings. It will help you learn about different tools and indicators.

Risk-Free Trading

Losses are part of trading; however, they are the biggest fear of a new trader. Not every trader can handle losses, especially during the first few days. 

Therefore, trading a demo account is the best for traders who are afraid of risk. In this way, they will learn how to trade with zero risk. In addition, it will help them in identifying their risk-taking capacity.

Identifying strengths and weaknesses

The best part about demo trading is you get to know about your strengths and weaknesses. A trader can identify the ideal strategy, currency pair, time frame, diversification strategy, leverage, and risk-to-reward ratio. 

In addition, you can find out what works for you, which things you are better at, and what you need to improve. So you can make the best use of your strengths and work on your weaknesses.

Emotion Management & Psychological Development

Many traders think trading involves technical analysis. But no, trading is more about managing your emotions and maintaining the right psychology. 

A trader should keep emotions like fear, greed, stress, anxiety, overconfidence, etc. In addition, you need to embrace discipline, patience, and consistency. A trader will master these things with practice, and you can do that with a demo account.

Cons of Forex Dummy Account

No doubt demo account is a great way to learn trading in forex. However, it also has some limitations, so before subscribing, let us look at these disadvantages: 

Vague Trading

Generally, traders know they will not lose money in demo trading. So, ultimately, they end up using vague strategies and methods to trade. 

The fact that no money is involved in trading means traders are not afraid of risk. In addition, traders’ trade is greatly affected by emotions when real trading is conducted. However, with demo trading, no emotions are involved. So, if you fail to treat the demo account like a real account, then it will affect the entire result.

Limited Features and Technical Tools

Most brokers claim demo accounts resemble real trading accounts. However, that’s not the entire truth. The demo account has limited functions, features, and tools. So, it can be a disadvantage for some traders. 

Slippage and Gaps

Gaps and slippage are quite common when trading in the real market. However, while demo trading price gaps and slippage do not occur. So, ultimately, traders will not experience trading during such unexpected price movements. 


Forex dummy accounts are the best not only for new traders but also for professionals. With learning, you can check the authenticity of the broker platform and become friendly with trading platforms. 

In addition, it will help you find out whether forex trading is for you. So, if you are considering starting trading in currencies but have no experience, you must go for a demo account. 

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