Had Enough Practice Trading?

Most traders will start trading using a practice, or demo account which involves no real funds and therefore acts as a safe place to learn and make mistakes in the early period of the trader’s career – but when is it time to move to a funded ‘real’ account? This is the question every keen trader will be asking even before they start demo trading – but it is important that the process of learning to trade is not rushed, and instead taken slowly as an opportunity to study and analyze not just the trading system you have chosen to implement but also your own personal trading style.

There is no one trading system that will work for every trader. Just as there is no one car that is perfect for everyone – but there is a type that suits you, you just have to keep looking. The system is a means of developing a pattern of trading activities designed to deliver profits to you. In short – it’s a way of trading which should earn you profits. This is true no matter what you trade – if your system involves spending days to research the best stocks to buy and it works, go for it.

To find a trading system – simply look around. Look in trade magazines or online – there you will find every sort of course. From penny stocks to a forex trading course, there is something in the educational marketplace for everyone – and you do not have to pay for a course for it to be successful. There are plenty of expensive trading courses around that will not make you any money. Trust me, I know!

The most important thing I can say about the system is that you must apply it to your trading activities religiously. You simply cannot sit in front of a chart, knowing that your conditions for placing a trade have not been met, but still ‘have a feeling’ about what the price will do and therefore place a trade accordingly.

That is emotional trading, and is the quickest way to wipe out your trading account. By all means try it when you are practice trading and see what happens, but not on a real account. What needs to happen is that you must have a set of trading rules – concrete rules that you have written down and on display near your trading station. You must adhere to these rules – this is key! Only after you have traded according to your trading system and not broken (or ignored) your rules even once, and you are profitable three months in a row – then you are ready to trade a small account.