What if you could polish your trading strategies without putting any hard-earned cash on the line? That’s where simulated trading comes in, and it can be a game-changer for both beginners and seasoned traders.

Simulated or virtual trading gives you a risk-free playground where you can dip your toes into the world of Forex. Beginners can use simulated trading to safely navigate market turbulence and learn how to place trades. Seasoned traders, on the other hand, can test multiple trading strategies to figure out what works for them.

It’s like having a virtual Forex market at your fingertips. You can practice and learn from your mistakes without any real money at stake. But to receive a simulated funded account, you’ll need to sign up with an evaluation firm.

Let’s look at how simulated trading works and why you should consider it.

Earn Money on a Simulated Funded Account

A simulated funded account mimics the experience of trading with real money. Upon signing up and passing an evaluation, traders are given virtual capital. They can then use this funding to take positions on various instruments, such as Forex, indices, or cryptocurrencies.

Traders have access to the same technical tools, charts, and indicators they would use in live trading. This allows you to test real-life trading strategies and scenarios.

man practicing trading strategies
Photographer: Ground Picture

Even though your trades are virtual, the profits you earn from them are real. Evaluation firms use your setups to look for profitable trades in the real market.

The profits generated on your performance are split between you and the firm. The split is usually around 70–80%, but it can go up to 90% if you show exceptional results.

The most successful funded traders treat the simulated environment as if it were the live market. Say you show consistent profitability or achieve specific trading goals. You might repeatedly hit a certain percentage return or maintain a low drawdown (loss). Depending on the firm, you may receive a bigger simulated account with a higher profit split.

Diversify Your Portfolio

Diversifying your portfolio is a fundamental way to become a successful trader. Simulated trading offers the perfect platform to master this strategy.

For instance, you can try trading different currency pairs in the Forex market. Simulated trading lets you explore the concept of price action to learn how currencies react to different economic indicators and geopolitical events. This gives you a better idea of which pairs to pick as per your trading style and risk tolerance.

You can also practice trading across different market times. The Forex market operates 24 hours a day, five days a week. Different trading sessions, such as Asia, London, and New York, overlap during the day. This overlap usually sees heightened trading volume and more volatility. It’s the best time to test how your trading strategies work in different time zones. The volatility is also a good opportunity to find new trades in the market.

What’s more, simulated trading also helps you understand leverage and how to use it to your advantage. You get to experiment with varied leverage ratios on different pairs. Then, you can assess the impact of leverage on your trading performance and use it to diversify your trades.

Lower Personal Risk With Simulated Trading

Simulated trading is the ultimate way to lower personal risk as you learn and master your trading strategies. Most notably, it eliminates the need to invest high levels of your own funds.

Unlike live trading accounts where real money is at stake, a simulated funded account gives you virtual capital. This means any losses incurred during simulation have less financial impact on the trader. It’s like having a safety net while you practice to help cushion the fall.

Forex trading chart
Photographer: Rawpixel.com

What’s more, it’s the perfect environment for learning risk management. You can experiment with different risk-to-reward ratios, high-risk trading strategies (if your evaluation firm allows), and leverage and lot sizes.

Even after the trade is placed, you have the option to adjust parameters such as stop-loss and take-profit to tailor your risk exposure.

Refine Your Trading Strategies

Refining your trading strategies takes practice, patience, and a keen eye to figure out what works best. Fortunately, simulated trading offers the perfect stage for this. It gives you a risk-free environment to test different approaches. Whether you’re a trend follower, a scalper, or an ICT trader, virtual trading allows you to try strategies without risking real capital.

This means you’re free to explore new ideas, try out unconventional techniques, and see how different methods stack up against one another. You also get to assess the effectiveness of your trading strategies in real time.

For instance, you can track performance metrics such as win rate, average return per trade, and drawdowns. This gives you valuable insights into the strengths and weaknesses of every approach. Based on this, you can then adjust and optimize your trading methodologies. You can try everything from tweaking position sizing to opting for an aggressive risk-to-reward ratio.

Test Your Trading Strategies With Rocket 21

Rocket 21 Challenge is a trusted evaluation firm that lets you work on your strategies in a simulated environment. Hundreds of traders have received simulated funded accounts on our platform. But first, you must pass our evaluation challenge.

You can choose from two challenges: Standard (two-step) or Apollo 11 (one-step). With each challenge, you’re given a set of drawdown and profit parameters. The challenges are designed to test how traders apply their strategies in different market conditions. Successful traders earn consistent profits while adhering to the drawdown parameters.

Once you pass the evaluation, we’ll provide you with a simulated funded account. At this point, you’re free to place trades without the pressure of achieving a profit target. You get to keep 85% of the profits you generate. Plus, our profit split goes up to 90% for the best traders.

Sound exciting? Then try our challenge today for a chance to win a virtual funded account.