Using Spread Betting Demo Accounts
Spread betting is a transcendent method of making money in the world of finance, provided of course that you have the skills to do so.
Spread betting is simply the process of predicting whether specific prices are going to move up or down. If your prediction is accurate, you make money or else you lose. The concept is similar in terms of conventional share trading in the sense that your profits will be determined based on your assessment of the future. The profit potential of this form of trading can be impressive in comparison to ordinary share trading.
If you are looking to dive into the world of online spread betting, setting up a demo account is virtually mandatory. A spread betting demo account is a feature provided with most companies. As the name suggests, demo accounts let you experiment with "play money" to get accustomed to the various concepts involved in spread betting and to familiarize newbie customers with the terms used as well as the software. When setting up a spread betting demo account, sign up with a company that lets you access their demo without an initial deposit. This way, you have nothing to lose and you won't be tempted to promote yourself to a real money account and risk losing your money.
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The idea of using demo accounts is highly debated among experienced traders. Some claim that due to the virtual nature of the market, it may cloud your judgment when you eventually shift to real money and result in you incurring losses. The majority claim that taking the spread betting demo account "crash course" of familiarizing yourself with the terms and how the market works is essential and greatly assists you when you start off with real money. Experimenting with a demo account seems the more sensible option, specifically if you have very little knowledge of the concept of trading.
Testing Orders on a Demo Account
One of the main advantages of using a demo account before putting real money at work spread betting is that you can test the platform order types. For those new to trading it can be quite daunting. You have limit orders, stop orders, one cancels other (OCO), kill or fill and more (depending on your provider). You can use these to enter and exit trades on the spread betting demo account with no risk at all, and any mistakes (which will probably happen) can be made on your vitual account balance.
Spread betting, like most other money making opportunities requires careful analysis and a comprehensive learning phase thus a using a demo account is an ideal place to start before risking real money.
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