Before risking a cent on the 20-pip challenge, prove it on a demo account. A demo mirrors live prices with virtual money, so you learn how the system behaves with zero financial risk. Here's how to do it properly.
Why demo first (not backtest only)
A backtest looks at the past with hindsight and often ignores real spreads and slippage. Forward-testing on demo shows you how the strategy behaves on live, unseen prices — the honest test. Treat backtests as a sanity check and demo as the real rehearsal.
Set it up to match your live plan
- Open an MT5 demo with the same broker (or account type) you intend to go live with — so spreads and execution are realistic.
- Use your real starting balance. Test at the size you'll actually use, so sizing and the minimum-lot floor behave the same.
- Keep the same settings you'd run live. Changing things mid-test invalidates it.
What to watch (it's not just the balance)
- Win rate vs the break-even bar. Are you clearing ~46–50% after costs? See the math.
- Drawdowns. How deep, how often? Could you stomach that on real money?
- Trade frequency. Too many trades can signal weak filters; very few may be normal for a selective system.
- Real spreads during your sessions and around news.
Run it long enough
A handful of trades tells you nothing — variance dominates small samples. Aim for a meaningful number of trades across different market conditions (trending and choppy weeks) before you judge anything. Weeks, not days.
Then start small live
When you go live, start with the smallest stake that still follows the rules, and expect live results to differ from demo (real fills, emotions, occasional slippage). Scale only once live behavior matches your demo expectations.
A note on bots
If you're running an automated version, demo is also where you confirm the bot is installed correctly, sized properly, and that its risk guards trip when they should. Our bot is built to be demo-tested first — the get-started guide walks through it.
Demo testing can't guarantee future results, but skipping it is how avoidable mistakes become expensive ones. Test first, always.