Virtual trading is a risk-free way of trading binary options. If used correctly, it can help you test yourself and your strategy, and develop a profitable trading style with almost no risk. This article explains how virtual trading can help you become a successful binary options trader and how you can get started.

In detail, this article answers the following questions:

  • What is Virtual Trading?
  • Why should I use virtual trading?
  • Where can I find the best virtual trading environment?

With this knowledge, you will soon be able to improve your binary options trading with virtual trading.

 

 

What is Virtual Trading?

Virtual trading means trading binary options in a virtual environment. Instead of investing real money, you trade with play money. Everything else is the same as normal trading. You get the same tools, the same features, and the same trading style. The only difference between normal trading and virtual trading is that normal trading has consequences while virtual trading takes place in a simulated environment. All types of prices, assets, and binary options are real, but the profit or loss you make with them is not. You are more or less playing a game based on the real world instead of investing in it. There are two basic forms of virtual trading. They are:

Virtual Trading, Type 1: Demo Account

A demo account is an account that offers the same functionality as a regular trading account. They offer the same features as regular trading accounts, the same types of binary options, and the same assets. The big difference between a demo account and a regular trading account is that a demo account allows you to trade with play money instead of real money. When you get a new demo account, there will be some play money waiting for you. The exact amount varies from broker to broker. In this environment, you can trade just like you would with a real account, but you are free from any risk. You can try whatever you like, but you won’t lose a single Cent. You get real prices and market movements, and any decisions you make based on them will looks  really   real . If you want, you can use your demo account like a game. The only difference is that if you are good at binary options trading, you can turn the game into reality and earn money. A Demo Account is a great way for people who have never tried binary options to see if they have what it takes to succeed in this environment.

 

 

Virtual Trading, Type 2: Paper Trading

Paper trading is the original form of virtual trading. It’s a bit out of date, but we’d like to mention it at this time as an alternative to a demo account. If a demo account is not possible for you, you can go back to paper trading. As the name suggests, paper trading takes place entirely on paper. Instead of investing in real binary options, you monitor the market until you find a situation where you will invest based on your strategy. Pay attention to trade details – assets, expirations, investments, and payouts. Now wait until your option is about to expire and observe whether you will win or lose the trade. Also calculate the profit or loss you will make. After a while, look at your notes, and calculate whether you will make a profit overall. This type of virtual trading is ideal for traders who cannot use a demo account for some reason. If you can use a demo account, however, there is no reason to go back to paper trading. A demo account can automatically do many of the things you do manually with paper trading, which is why it’s a superior alternative in 99 percent of all cases.

Why should I use virtual trading?

Now you might ask why use virtual trading. After all, the point of financial investment is to make money. When you trade with play money instead of real money, this is impossible. However, there are many good reasons why  every  trader should use virtual trading. Let’s take a closer look at these reasons. There are three main reasons to use virtual trading. They are:

  1. Test broker,
  2. Develop strategies,
  3. Make modifications to your strategy.

Each of these advantages applies to brokers at certain stages of their careers. Let’s take a closer look at each of these advantages.

Reason # 1: Test A Broker

Binary options brokers are like cars. They all promise to be the best and most reliable. Just knowing which of them keep their promises is a test of them. Virtual trading is the same as a test drive. Just like cars, the differences between brokers are often small and hard to tell. Some brokers just  feel more comfortable than others. This difference is very subjective, and the only way to know which broker is right for you is to test several brokers with their demos. In addition, all brokers offer different payouts in different market situations. It is impossible to say which broker offers the best payout for your strategy. Some traders do better with one broker, other traders do better with another. Again, the only way to know which broker is best for you is virtual trading. In our list of brokers, we have listed the best brokers on the market right now. All of these brokers are trustworthy, government regulated, and completely trustworthy. But we cannot tell you which of these brokers is best for you. You will be successful with all of them, but if you want to make the best decision, you need to test them for yourself.

Reason #2: Develop Your Strategy

Once you have found a broker you like, you need to develop a profitable strategy. As with all newcomers to any field, you’re unlikely to get things perfect on your first try. You will probably make some new mistakes and do some things that will make you trade. The effects of these lost trades can be severe and may ruin you – unless you make them in a risk-free virtual free trading environment. A demo account allows you to trade just like you would with a real account but avoid the consequences. Since newcomers face many negative consequences due to lack of experience, a demo account is an ideal tool for them. We recommend that all newcomers start their career with a demo account. Trade as you would with a real account, and check your account balance every week. Did you make or lose money this week? If you lose money, why? What can you do to improve? Ask yourself these questions until you make a profit. Keep trying new things and improving your strategy, and eventually you’ll develop a strategy that you know makes you money. Once you are able to make profits three or four weeks in a row, it may be time to switch to real money trading. Since you are familiar with your broker and your strategy, you should be able to turn a profit from the start. Did you make or lose money this week? If you lose money, why? What can you do to improve? Ask yourself these questions until you make a profit. Keep trying new things and improving your strategy, and eventually you’ll develop a strategy that you know makes you money. Once you are able to make profits three or four weeks in a row, it may be time to switch to real money trading. Since you are familiar with your broker and your strategy, you should be able to turn a profit from the start. Did you make or lose money this week? If you lose money, why? What can you do to improve? Ask yourself these questions until you make a profit. Keep trying new things and improving your strategy, and eventually you’ll develop a strategy that you know makes you money. Once you are able to make profits three or four weeks in a row, it may be time to switch to real money trading. Since you are familiar with your broker and your strategy, you should be able to turn a profit from the start. Keep trying new things and improving your strategy, and eventually you’ll develop a strategy that you know makes you money. Once you are able to make profits three or four weeks in a row, it may be time to switch to real money trading. Since you are familiar with your broker and your strategy, you should be able to turn a profit from the start. Keep trying new things and improving your strategy, and eventually you’ll develop a strategy that you know makes you money. Once you are able to make profits three or four weeks in a row, it may be time to switch to real money trading. Since you are familiar with your broker and your strategy, you should be able to turn a profit from the start.

Reason #3: Test Modifiers To Your Strategy

Once you have created a profitable strategy, you have two goals:

  1. Make sure your strategy remains profitable, and
  2. Increase the profitability of your strategy.

Both of these reasons are why you need to keep testing modifications to your strategy. Unfortunately, you never know whether a modification will actually increase the quality of your trade or decrease it. Even if they seem like a sure thing, there’s always a chance that your changes will mess up your entire strategy and, as a result, could potentially ruin you. This is why you want to test the changes in a risk-free environment before you use them for your real money trading. Virtual trading offers the perfect environment for this test. There are two ways in which you can use your virtual trading to test modifications to your strategy:

  1. Trade your new and old strategies simultaneously, the new strategy with your demo account and the old strategy with your regular account. After a while, you can compare the results. If your new strategy makes bigger profits than the old one, you know that the change is good. This way of testing gives you the most accurate results because you test both strategies in the same market environment. It also requires the most detailed attention. Especially if you use a complicated strategy, it may be impossible to execute it twice at the same time. Remember: you need to avoid making mistakes because you get overwhelmed, or you distort your test results.
  2. Test your new strategy with your demo account while stopping your real money trading. After some time, compare your virtual trading results with your real money trading results that you had before. This way of testing is easier to implement, but it produces slightly less accurate results. However, as long as you execute a high enough number of virtual trades with your new strategy, you should get good results.

 

 

We recommend that every trader should use a demo account to try out modifications to their strategy. Even if you have been trading well for 30 years, looking at the market from a different perspective can only help. Many successful traders dedicate a set amount of time this year to testing new things. For example, you can pause your real trading for a month of the year and try new things, or you can take a few days each month for virtual trading.

How to Get Started

Almost all binary options brokers now offer a demo account. To get the best virtual environment, we recommend newcomers to try IQ Option. IQ Option provides the invaluable advantage of a no-deposit demo. Some brokers offer their demos as a feature of their regular accounts. You need to get a regular trading account to get a demo, and getting a regular trading account requires you to deposit money. This means you have to deposit money with the broker to test it. The demo is also free. If you don’t like the broker, you can just withdraw your money and be done with it. But why deposit money with a broker if you are not sure if you want to trade with him? For IQ Option completely no deposit. You can sign up for the demo by simply logging in with your Facebook account, your Google account, or your email. This is the easiest start you can get to binary options, and it’s the way it should be. In addition, IQ Option is the highest rated broker based on customer satisfaction in our list of top brokers. You get high payouts, huge assets, and great types of binary options. The no-deposit demo allows you to test the best brokers out there completely hassle-free. If you can get the best for free, why would you test anything else? Of course, there is still a chance that IQ Option is not the right broker for you. In this case, you should continue to test other brokers.

The conclusion

Today, the most relevant form of virtual trading is the demo account. A demo account allows you to freely trade all features of the broker without risk, which is the right environment to test yourself, the broker, and create a successful strategy. If you are still looking for the right broker for your virtual trading, we suggest looking at our list of brokers.