Practice CFD trading successfully
By practicing trading you can get useful experience that you can use once you start trading with real money. You can practice trading for free with a demo account at one of the online CFD brokers. Most CFD brokers allow for unlimited practice time so you can practice as much as you like.
If you practice trading you immediately gain very useful experience. Because when you use a demo account to practice and trade risk free, the circumstances are exactly the same as when you would trade for real money. The money you earn with your demo account is of course fictional, however the results are the same as if you were trading with real money. And because the results resemble real circumstances, practicing immediately gives you a good idea of what trading with real money would be like.
If your practice first you will be more successful when you eventually begin to trade with real money. You get to know behaviour of the markets and you will discover the various possibilities the software provides. This allows you to try all sorts of strategies and tactics and eventually you will find out what works for you. In the end the main purpose of being a successful trader is to make money on the stock market and how to achieve that is entirely up to you!
You can easily practice trading using the Plus500 software. With this software it is possible to open positions on all kinds of popular securities like indices, Forex, commodities and stocks. Because of the large range of products offered at Plus500 you can trade almost anything. Just choose your favourite instrument and start trading.
Practicing is the best way to discover what does work and what doesn’t. Before you begin as a trader, we would like to give you some tips that might help you to invest and trade more successfully. Everyone makes mistakes in the beginning, but by applying these tips you can severely limit the risk of making such mistakes!
Some tips to get started successfully
- Always use a stop loss: that way you limit the loss on a position.
- Maintain a positive relationship between risk and (potential) returns.
- Do not risk more than a few percent on one position: that way you won’t directly go bankrupt.
- Do not invest all your savings immediately: it is better to gain experience first and then gradually expand your account.
- Do not randomly open positions: closely examine the price charts and make rationalized decisions.
- Successful traders take their losses: close unprofitable positions!
From fictional to real money
Once you have practiced enough you may decide to trade with real money. The transition from trading with fictional money to real money can sometimes be a big one. Losses are much harder to accept when it’s your own money and therefore there is a chance that your emotions might hinder you in becoming a successful trader.
It is therefore wise to define your goals in advance and to place stop loss and take profits before opening the trade. After you have opened your trade you should not adjust your stop loss or your take profit because if you do so, most of the time you do so because of certain emotions. However, you should not give up after a losing trade, have some perseverance and I’m sure you will make money.