New traders should know!

[Saif21]

Your votes counts.

 

[MasterOfCoin]

A new trader will be best advised to 'test' out strategies in a demo account before committing significant funds to a tested, profitable, strategy. That said, nothing teaches you faster or better than having your own hard earned cash at stake. Just don't use money you can't afford to lose until you can consistently win.

💰

 

[mpups]

Is it advisable for a new trader to start investing his/her money while learning the trade?

• Yes
• No
• Yes but invest little
• Yes but not alone

I don't know what "Yes but not alone" means..

 

[MasterOfCoin]

I don't know what "Yes but not alone" means..

Maybe it means you ask Fido for advice ...
One 'wuff' for yes, trade and a growl for no, don't ??

🐶

 

[wmram]

It's money ( skin in the game ) that provides the proper motivation to get it right. Demo accounts are worthless. Most all strategies are dogs with flees. It's the person that makes that strategy work. One of the ways in which that person makes it work is by acquiring experience working with risk under pressure. Demo accounts aren't going to get you there. You don't have to have a large account; try and keep a $100 account alive.

 

[Happy2trade]

Better finish demo trading for some months before going live. Even after that, dont risk too much, start with a small capital and use a micro account.

 

[Nowler]

The key word for me is "advisable".
The answer: no. Nobody should be advising anyone to do this.

Can you? Of course you can, but if you don't have money and risk management under control then you are in real danger of losing capital.

The game can be tricky enough to navigate for people who know what they are doing.

 

[wmram]

If the thought or reality of losing money makes one skittish, forget about trading you won't last. I don't think that you will ever be successful trading short term price movement until you learn how to lose money. Timing entries and exits is not so simple a thing to do consistently well especially in an environment where prices are always trying to turn.

 

[brfrexloid]

New traders should know that forex is not a place for making instant large profits. Beginners have to be patient to learn forex trading and have to move gradually in order to practice strong trading skills.

 

[drcruz]

New Traders should have their money "invested" in a longer term portfolio **before** risking money toward "trading". No more than 10 to 20% of net worth should be at risk when trading. But if I am misunderstanding the question, to get your psychology right the new trader should risk some money (as little as possible)while learning the trading craft. Slowly build up from there as account grows. If starting with very little, keep your day job and add to your account on a regular basis ***after*** you have put money away in your long term portfolio

 

[Henow1969]

Yes but should start with a little amount and never be greedy to make a lot of profit in no time.

 

[kevinberry]

If you are still learning, invest just a little amount. So that if you have a loss, it won't affect you much.

 

[WalletInvestor]

It's money ( skin in the game ) that provides the proper motivation to get it right. Demo accounts are worthless. Most all strategies are dogs with flees. It's the person that makes that strategy work. One of the ways in which that person makes it work is by acquiring experience working with risk under pressure. Demo accounts aren't going to get you there. You don't have to have a large account; try and keep a $100 account alive.

I wouldn't dismiss demo accounts like that. You don't experience trading psychology phenomena on a demo account, and that is important to keep in mind, and a lot depends on the person, but how you build your strategy matters. Strategies are not set in stone, there are technical things that can and should be improved if needed such as risk management.

 

[drcruz]

I manually back test frequently, which really accelerates the learning curve. I try to feel the feelings during historical crash periods and try to visualize performing the correct actions during these times. I also try to take notes analyzing those periods. With that said Larry Williams and Mark Douglas both say small bet sizes help with your psychology. For a while, during my initial part of my options trading journey I tried to keep my bet size around 1.5% of available capital and that really helped my psychology

 

[wmram]

I wouldn't dismiss demo accounts like that. You don't experience trading psychology phenomena on a demo account, and that is important to keep in mind, and a lot depends on the person, but how you build your strategy matters. Strategies are not set in stone, there are technical things that can and should be improved if needed such as risk management.

I wouldn't dismiss demo accounts like that. You don't experience trading psychology phenomena on a demo account, and that is important to keep in mind, and a lot depends on the person, but how you build your strategy matters. Strategies are not set in stone, there are technical things that can and should be improved if needed such as risk management.

Well said. Still money changes everything. Spend all the time you want on demo; I think it likely that what looked good on demo will tend to look a lot iffier when money is involved and I am talking about small amount of money. Open $100 account. Trade one microlot. Learn what it's like to lose money; a valuable skill in my opinion. Timing entries and exits is hard to do consistently well. But all that said, I do take your point.

 

[Elsa50Pounder]

Always start with a demo account. Some people underestimate it, but a demo account can diminish so many probabilities of loss. It is best to learn beforehand by practicing in a demo account rather than directly diving into the market.

 

[HeavLeighGill]

I didn't invest any money into anything (no mentor, didn't open live account) in the beginning. Spent quite a while on demo before I felt comfortable enough to do so.

 

[wmram]

Trading is a money game. If you are trading Fx, you can trade audjpy for $14 to $15 margin. If price moves against you by 100 pips, you're talking about a loss of less than $9. If numbers like that are unacceptable to you , then you're in the wrong business. If you're trading Fx then the available liquidity is determined by the liquidity providers that your brokerage works with. During those times when available liquidity is low, you will have an opportunity to experience how sensitive the market is to your presence even if you're trading at 1 microlot. Not just sensitive but predatory toward your poistion. These are important experiences that you will not see trading on demo accounts.

 

[NVP]

dont waste a penny until you have spent months learning all the key aspects of trading ...then start on demo for a few months .....you will thank me

 

[wmram]

Paper trade your approach for however long it takes for you to believe in your approach. Open a small account $100.00 is more than enough. Work out the execution of the approach in a realistic environment. The money that you make or lose is the motivation to come to work eveyday, and pay attention to what you're doing. Keep in mind we're talking about trading 1 microlot; that's not much more than a grub stake.