Using A Demo Spread Betting Account To Test Your Trading Strategy
So you’ve had an idea for a new trading strategy and have back tested it using historical charting. Now you need to forward test your idea to see if it actually works in real time. The best way to do this is to use a demo spread betting account which most brokers offer for free.
Inside a demo account you will find a fully functional working version of the spread betting platform loaded with a virtual balance. With this balance you can place demo trades and see profit or loss from these virtual trades in the exact same way you would with a real deposit. Using a demo account allows you to forward test your trades and tell for sure whether your method is going to make you money or make you lose.
You will find real time prices to trade and be able to place stop losses, limits and other types of orders just as you would with a full account. Please be sure to test your strategy fully over a decent period of time. Testing it for just one day will not be enough. Market conditions can vary from week to week and become more or less volatile with news and economic decisions by governments. What works one day may well not work the next.
If you have researched your strategy properly you will understand that when spread betting you will need to take losses to eventually gain profits. The key is to have system that can make more on winning trades than it will lose on losing trades. Sounds easy? Well it isn’t. You should use a demo spread betting account for a sufficient amount of time that has enabled you to see how the strategy works during fast moving markets and slow ones.
Once you are convinced your strategy is working how it should be, you can then move to opening a full account. Try to move slowly. There is no reason to hurry, the markets are not going anywhere but your deposit might if you do not start off by trading small and getting used to it slowly and in a controlled emotionless way.
