If you are serious about your trading then you will want to take the time to verify any strategies prior to using them on your live account.
This is where a binary options demo account is vital to help you get the most from your trading. It provides a way in which you can build up a picture of performance without putting your capital at risk.
Before you begin to trade a strategy on your account, it is important that you firstly validate how it is likely to perform. There are many variables which can affect the results that you get including the strategy itself and user implementation. You will want to familiarize yourself with both of these aspects before you risk your money in the markets.
The binary options brokers free demo account is much sought after by those in the know. It can be used to provide you with your first introduction to the dealing platform. You can also use it to find your way around the many features and tools that it offers.
As well as allowing you to find out about the dealing platform, these accounts are also useful in helping the new trader get to grips with finding their way around the platform. Free binary options demo accounts offer all the features and functionality that you would expect to find on a live funded account.
You can open and close contracts and monitor your positions on the supplied binary options charts. The only difference is that you won’t be trading with your real money. Instead you will only be ‘risking’ the virtual money in the account as you learn the ropes.
This is as close to live trading as you can get without actually trading for real. To attain success you need to become familiar with the actual trading of strategy as well as the mechanics of the strategy itself.
Validate And Practice Strategies
Part of the process of research into your strategies should include ‘paper trading’. This refers to the virtual trading of the strategy away from a live environment to determine how it performs. This is often a case of manually working back through your charts and data and noting down performance.
This may seem a tough exercise and indeed it can be hard work. It will however let you build up a picture of performance. More importantly, it could save you a lot of money. In doing this you won’t have to find out the hard way that the system that you were planning on using doesn’t work .As a result you should avoid seeing your account balance rapidly diminish.
These days tracking down the performance of a strategy is however often much easier. Trading platforms such as MetaTrader will allow you to build Expert Advisers to back-test many strategies. As many MetaTrader brokers now offer CFD’s and Spread betting, you won’t just be limited to testing Forex strategies.
No matter how you validate a strategy initially, it is always a good idea to actually test it out under live market conditions. A binary options practice account will provide you with the best way of doing this. These are funded with virtual capital which you can use as you would your own money to purchase contracts in your account. The level of virtual credit varies from broker to broker but is typically in the region of $1000 to $10000 dollars.
Opening A Binary Options Demo Account
While demo accounts are widely offered in Forex trading, their use in binary options has until now been somewhat limited.
There are generally two types of demo accounts offered by brokers -
- No Deposit Demo account
- Deposit required demo account.
No deposit accounts as their name suggests are free to open. The only downside (if you can find them) is that once you open a demo account it will generally only remain active for a limited time.
Most brokers provide the second option. This means that you should expect to have to open a live account and make a deposit prior to being given access to a demo account. The benefit here is that these accounts don’t generally expire so you will always have an account on hand to test out your systems.