Why demo performance is often better than live performance?

[REB_FX]

99 % will lose due to psychology

Sad, but true

 

[new digital]

Sad, but true

here explanations

http://tradingpsychology1.blogspot.com/2017/

 

[REB_FX]

here explanations

http://tradingpsychology1.blogspot.com/2017/

Really informative read, thank you, really helps to understand the science behind it as well.
A big help !

 

[Steveday]

I believe that you do not work under the same pressure when you use a demo account and can releax more when you trade. It is only when you become more experienced that you learn to control your emotions and become more confident.

 

[new digital]

Demo trades get filled , back testing trades get filled, real accounts get requotes , slippage and non filled trades.

 

[Baazex]

A new trader must start with trading on demo account so that he can learn the concepts and technicalities of trading.Trading with demo account is vital when one is a new trader Going directly to live, means taking too much risk of loosing money .Its best for them to trade risk-free with a demo trading account.

 

[fxtrendtrader]

When I first stared trading, I started with a no deposit bonus, traded, like on a demo... and I was very successful, then I started learning. And lost all.
I overcomplicated things and made one mistake after an other. Now I'm restarting trading after a break, and try to keep thing as simple as possible.

 

[new digital]

back tests usually fail in real markets due to non fills,slippage,internet and computer shutdowns.
Demo traders always fail on live accounts, due to psychology of real losses, but also when there is no income to pay bills.

 

[DT77]

That's the big issue with back testing. Your back testing needs to smash it out of the park to have any chance of making it when you go live

 

[Deara11]

When trading demo account, traders never face moral discomfort and fear to lose money. As a result, they keep calm and always make rational decisions. On the other hand, while trading live account, most of us are afraid of lossing money, that lead to a lot of mistakes. One of my friends was very profitable on demo account, I can even say that he is talented, but when he tried to trade with real money, he just lost everything, cause he was so afraid by the thoughts that every decision matters, that eventually he couldn't make any right decision. And the same is happening to a lot of traders, that are paralised with their fears and doubts. To avoid this, really succesfull traders need to master not only trading skills and ability to predict markets' behavior, but also their mindset.

 

[Ary Barroso]

99 % will lose due to psychology

Psychology is a great issue; but don’t think it’s the key point; lack of knowledge & practice is the main issue here!

 

[fxtrendtrader]

How many people who start a company or any other business will succeed?

 

[TFA]

perhaps it's the psychological aspect and you attach too much pressure to yourself when it is a live account

 

[new digital]

How many people who start a company or any other business will succeed?

This is trading forum to talk only about trading failure rate.

 

[TFA]

less stress when it is not real money.... i mean try playing monopoly with real money!!!

 

[fxtrendtrader]

This is trading forum to talk only about trading failure rate.

It's the same thing, it's only faster.

 

[torry9]

less stress when it is not real money.... i mean try playing monopoly with real money!!!

Right. If you want to make money, you have to take up risk which comes only when you trade with your real funds.

 

[vntrade]

I also notice a difference between demo and live performance. For live contest, the maximum profit of winner is about 500% but with a demo contest, top 5 can make thousands of percent profit, or 10000%. Are traders afraid live because of their money while demo they can trade without risk and as a result their performance is so outstanding.

 

[michelleprice]

In the casual world of free demo accounts - many young traders find they are able to garner impressive profits without a significant amount of effort. It almost seems too good to be true. But transferring this success from a demo account to a real account is far less common. Why is this?

Because they have more at stake with a real account so the psychological factors come to play.

 

[Lukacs88]

Cause demo has no real emotion and live simulation is difficult and not as easy as demo.