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Making The Most Of Your Free ZuluTrade Demo Account

            Perhaps the best tool available to you, the ZuluTrade user, is the free ZuluTrade Demo account.  Even if you have been trading live for months(or years) you should still be using a demo account for testing a screening new signal providers.  I have demos running at all times and in this article I hope to tell you exactly how I use the free demo accounts and how they make my job of screening signal providers infinitely easier.

            When I start looking for potential new signal providers to add to my portfolio I use a 4 step screening process that I call pyramid screening.  The idea is to start with a great many signal providers and weed some out at each step along the way until I am left with very few.  My hope is that these very few will fit in with my portfolio and my overall plan.

            The first step I take is to simply look at statistics for hundreds of traders.  I will obviously week out the ones who are -45000 pips or have 86000 pip draw downs.  I am looking for anyone who looks good at first glance.  Someone who is a winning trader, has a reasonable maximum historical draw down, has had their account open for several weeks(or months), and has a fairly even equity curve.  Anyone that meets my criteria in this step is immediately moved to my first demo account for further review.

            Once I have a trader in my demo account, and they are placing trades, I can see how they manage their trades.  I can find out if they move their stops away from their entry to keep from being hit.  I look to see if they pyramid (add to) losing positions.  I can also look at the details for each particular trade and see where they place their stops and targets.  If you don't have a trader in your demo you will not be able to see any of this info.  You will only be able to see open, close, and profit/loss.  A lot of traders get weeded out at this step.  This demo account will probably have to be reopened time and time again because you will go broke on this account regularly as poor traders constantly will make a short stay in this account.

            Any traders that have passed the last 2 tests will be added to a second, separate demo account.  This account should have only a few traders in it and they should be winners.  This account should be traded exactly as if it were your live (real money) account.  Perfect practice makes perfect execution.  I generally allow traders to trade in this account for at least a few weeks with close observation.  If I don't find any reason to remove them from my portfolio they make it to the final step in the process.  They are moved to my live account and begin to trade with real money. 

            Once a trader is trading in your live account you should be pretty confident about who they are and how they trade.  Its still a good idea to check in on your account daily or at least a few times a week.  It is possible for a good trader to go bad so it is always a good idea to keep an eye on anyone who is trading with your money.  I like to keep a spreadsheet of traders that I decided were not fit to trade in my account and a reason why next to the name.  This saves me a lot of time rechecking traders and allows me to screen for new traders every month or so without taking up a ton of time.

           Please, if you're not already, start using a free ZuluTrade demo account. 

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