Why use a binary options demo? Well, there are five good reasons. Some of them save you money; others increase your profits.
Those five reasons are:
- Try binary options risk-free,
- Make your rookie mistakes with play money,
- Develop your strategy in a risk-free environment,
- Keep improving your strategy without risking real money,
- Try new brokers.
In this article, Why use a binary options demo, we will look at each reason separately. You will learn how to use a demo to save money and increase your profits.
Why use a binary options demo? Five good reasons for a demo
Let’s look at all of the reasons why new traders should get a demo.
Reason 1: Try binary options risk-free
When you start trading binary options, the first thing you need to find out is whether you have what it takes to become a binary options trader. Do you like trading ultra-short time frames? Do you feel comfortable with technical analysis? Do you understand what the market is doing?
All of these questions deserve answers. Finding these answers with real money, however, can be expensive. Nobody ever knew for sure whether or not they were made to be a successful binary options trader, and betting real money on such uncertainty would be unwise.
With a demo, you can find the answer to this question without risking anything. Equipped with a fully functioning trading platform and play money, you can test binary options completely risk-free, allowing you to find out whether you have what it takes to make money or not.
After a few days of testing your demo, you will soon know whether you like trading binary options and whether you have a future as a binary options trader. If so, great. You can still start trading with real money. If not, you have saved a lot of money. If you had started trading with real money, for example by investing $1,000, you might have lost it all. A demo account is a life-saver.
Reason 2: Make your rookie mistakes with play money
If you have found that you have a talent for binary options trading, you will still need to learn the basic of the craft. As with any learning process, this process, too, will involve making some rookie mistakes.
- Maybe you accidently invest in the wrong asset, the wrong direction, or the wrong expiry.
- Maybe you mistake a chart formation for something that it is not and make a bad decision.
- Maybe you trade in a bad mood because you have not yet learned with mindset works best for you.
These mistakes are unavoidable. Every trader will make them eventually. The important thing is that you get them out of your system before you invest real money. If you invest $50 on a doomed trade, you have lost a lot of money that you will have to work hours to get back.
With the risk-free alternative of a demo account available, there is no point losing money on the mistakes you know you will make by making them with real money. Get you demo account first, allow yourself to make your rookie mistakes in a risk-free environment. Wait until you have mastered all aspects of the different binary options types and assets and your trading platform before you switch to real-money trading.
Reason 3: Develop your trading strategy in a risk-free environment
Once you have got your rookie mistakes out of the way, it is time to start developing your trading strategy. A trading strategy is a fixed set of rules that defines how you find trading opportunities and how you capitalize on them.
Without a trading strategy, your trading would be random. You would never know why you are making or losing money, and you would be unable to improve your results.
A trading strategy might be the most important tool to your trading success. Developing a trading strategy, however, can be a tedious process. You have to test different trading styles and find those that work for you while eliminating those that don’t work.
In the process of this effort, you will necessarily try some things that lose you trades. While this process is inevitable, it would be a shame if it would also lose you money, especially since it is so easily avoidable.
With a demo account, you can try different trading styles in a risk-free environment. Keep the things that work for you, and throw the rest out. After a while, you will have found a trading strategy that you know makes you money. And you will have found it entirely for free, without risking anything.
Reason 4: Keep improving your strategy without risking real money
Once you have found your trading strategy, you can switch to real-money trading. Nonetheless, your demo account will still be useful to you.
While your trading strategy now makes you money, it is not perfect. To keep trading successful and increase your profits, you constantly have to improve your strategy. In many ways, this is an automatic process. While you are trading, you will often face situations where you think to yourself, “I wonder if I could make money if a traded this situation like this and not like this.”
With a demo account, you can try such tweaks to your trading strategy risk-free.
You could, for example, try whether using one touch options instead of high / low options in some occasions could improve your profits. Keep trading your proven strategy with real money and try the tweak simultaneously with your demo. After a while, you will know which strategy works better for you.
This way, a demo account can help you to improve your profits and make more money.
Reason 5: Try new brokers
Once you have found and fine-tuned your strategy, you are set for success. Nonetheless, new binary options brokers emerge almost weekly, and existing brokers change their service. Consequently, you might want to try some of these brokers and see if you can make more money with them than with your current broker.
A demo account is an ideal tool to compare other brokers to your current broker. Trade both brokers simultaneously, your current broker with real money and the new broker with a demo, and you will soon know which service works better for you.
A binary options demo is one of the most important tools of your trading career. It is essential to learning the basics without losing money, to developing your trading strategy, and to continually keep improving.
We recommend that any trader should have a demo. If you want to get a demo, take a look at our top list of the best binary options demos. All of the demos on our list are free and with trustworthy brokers. You can safely choose any of them.