Reasons Why Cents Account is Better than Demo

It is widely known that in order for us to trade safely, we should have large capital to sustain the volatility in the market, Forex brokers are offering $50,000 virtual money on demo account, this is due to the fact that they know small account will easily blown by newbie traders who doesn't have idea on forex trading. Whereas if a trader use a bigger capital that will allow to trade 1 lot ($100,000) with a value of $1 per pip movement ( smallest decimal place on currency value), it will take many consecutive mistakes before he will blown the account.

Until when we should trade with demo account?
For many brokers we can use demo account unlimited. It is best use in testing strategy and until we are confident that our strategy was profitable.

When we should start trading on cents account?
We should trade on cents account as soon as we are ready to try the real forex trading.
Cents account represents big amount, if we made profit on cents account, we can also do that in bigger accounts.

Advantages & Disadvantages of Cents Account

It will help us eliminate our fear and build confidence on trading
Small losses if we have mistake on our judgement
Can open a small amount that will show dollar denomination
Small profit will grow big in due time
Slow profit

Advantages & Disadvantages of Demo Account

Good for testing strategy
We can evaluate the market execution of a broker
Unlimited trial
No risk
Profit in demo cannot be withdrawn.

All the common mistakes of a trader were realized and given a value when they encounter it on a real trading, Cents account will help us learn how to act and decide properly on currency trading.

Happy Trading!

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