Now we get to the finishing steps.  We will verify our testing in a demo account and I will give you some tips on finally going live on a real money account.

Forward Testing

Start your testing

Now it is time to open a demo account and continue testing your strategy in live market conditions, still without risking any real money.  Most Forex brokers offer a demo account, so you can learn how to use them.  Open a demo account with the broker that you will eventually trade live with.

To help your research, here are some things to look out for and who I trade with.   You may have different reasons than me for choosing one broker over another, so I’ll leave the decision up to you.  Basically, you want a broker that has:

• Excellent execution (your trade gets processed fast)
• Reliable and easy to use trading platform
• Small spreads
• Quality company with a lot of cash reserves (do your research!)

You are probably wondering why we need to keep testing, when we already did all that work backtesting.  Well, as awesome as backtesting is, it still has some shortcomings…

• Since you can take trades at any time of day in backtesting, that might not fit in with your real life schedule.  You might have to pick up the kids at some of the best trading times for your strategy.  Forward testing will show you any time-of-day weaknesses.
• The broker you choose may have a platform that is much different from the backtesting software you are using.  Use a demo account to give it a test run.  You don’t want to be figuring out how to place a stop loss when real money is on the line.
• There is a small chance that the pair you tested may have changed fundamentally over that past few months.  Not likely, but if your demo trading is much worse that your worst case scenario in backtesting, you may want to hold off from going live.
• Your broker might have some rules that you didn’t account for in testing.  For example, some brokers limit the number of currency pairs you can trade in a mini account.

Best to figure out these things now, instead of after you have funded your account.  In my opinion, you should Forward Test for at least 3 months (profitably, of course) before ever considering going live.  If you are still unsure, test for longer.

When it is time to go live?

This is where you have to step over this line yourself.  I cannot tell you when it the right time.  Like I say in my disclosure, I’m not here to tell you what to do with your money.

However, if you have seriously gone through this entire process, I think you will know when you are ready.  Even if you have doubts, some brokers like Oanda allow you to start with no account minimum and trade nano lots.

What are Nano lots? Nano lots are awesome!

They allow you to trade as little as 1 currency unit as opposed to the mini accounts at other brokers.  The mini accounts usually have a minimum of 1,000 currency units per lot.

Nanos allow you to get into almost any trade with a $100 account and only risk 1% per trade.  It will really give you good practice with a small amount of money.

You should start small

Even if you have been killing it in testing, when you start trading with real money (no matter how small), the psychology can be very different.  So, starting with a hundred bucks will give you that experience without risking your wad.   You can always deposit more later.

The process I outlined in these three lessons do the best job of preparing you for real money trading, but there is nothing like the real thing.

Hope this helped, if you want more detailed information on how to build a trading strategy, get my free Strategy Development Course.

Thanks for reading this series

Take advantage of the group approach to backtesting

If you liked this series, consider joining The Currency Alliance.

This is your opportunity to get in on the ground floor, save a ton of money and get access to a wealth of testing results.  Click here for more information and instructions on how to join.  It is only for people who are willing to work, but I believe that it can become a huge resource for figuring out what works and what doesn’t.  Think of it as crowdsourced strategy testing testing.

This offer will end soon, so if you are interested, act soon because I will take the page down when all the spots are filled.

Disclosure: I trade live with Oanda, but do not get any compensation for mentioning them.  I just think that they are a great broker. 

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P.S. – If you have 10 seconds to answer 3 simple questions, it would be very grateful if I could get your anonymous opinion on a few things.  This will help me deliver more information on this blog that will help you become a better trader.  Thank you very much if you already answered the questions.  Click here to help me out.  Cheers!

Photos (in order of appearance):  Horia Varlan,  skyfaller

Coffee usually doesn’t do much for me in terms of energy, but I do like the taste.  The way it works is that I get a caffeine buzz for about 20 minutes, then I get sleepy.  That is the way is has always been.

But if there was a coffee that could make me more alert during trading, I was all for it.  It’s cheaper than coke (just joking).  I’m willing to explore anything (no matter how small) that will give me an edge in trading.

Enter Upgraded Coffee

My first bag, right after getting the shipment

After hearing about some of the claims that were going around about this coffee, I had to give it a try.  Here is a quote from the Bulletproof Executive website:

“This coffee makes you feel noticeably better than anything else you’ll find. You’ll never go back to Starbucks again.”

Well, Starbucks coffee is quite terrible anyway, so maybe that’s not the best comparison, but the website also says:

“Upgraded Coffee is the result of an obsessive pursuit to find the absolute highest performance coffee beans on earth. It’s taken me more than 10 years to identify every step of performance-robbing toxin formation in coffee and to find a reliable, perfect source of beans that always make me feel great…”

Sounded a little sensational, but I’ll give almost anything a try…once.  So I placed my order.

What makes it different?

Before I get to my review, let’s start with how this coffee is different from the other stuff you find in the stores.  Almost all coffee beans are either dried in the sun or wet pressed, then left to ferment.  These processes make it easier (cheaper) to remove the tough outer layer of the bean and also have the added “benefit” of introducing large amounts of myotoxins, which makes the coffee taste better.

However, as the name suggests, myotoxins are…toxic.  So you are basically getting good tasting, cheap, toxic coffee.  Two out of three ain’t bad, I guess.

But it could be better.

Upgraded Coffee beans are mechanically processed right after picking, in clean, cold water.  But, who cares?  Well, let’s find out…

The Review of Upgraded Coffee

My first impression of the coffee was that it tasted good, but not the best tasting coffee ever.  On the first taste, I drank it black.  I would give it an 8/10 in terms of taste.  But it definitely tastes cleaner than other coffees.  I’m not sure if that makes sense, but that is the only way I could describe it.

And the energy?

That was the impressive part.  As I mentioned above, other coffees usually make me sleepy, but with Upgraded Coffee (affiliate link), I felt very alert.  The energy would last an hour or two, then wear off slowly, with no narcolepsy afterwards.

Then naturally, I decided to turn it into Bulletproof Coffee.  That is when I really started seeing some results.

It allowed me to focus through the London Session and a lot of the New York session.  I’m usually done after London and head for bed.

I didn’t feel jittery either.  It was a very natural feeling.  And true to their claims, it is the most satisfying cup of coffee I have ever had.  Again, not the best tasting (although it was still an 8/10), but it just felt really good to drink it…like my body needed it.  Yeah sounds weird, but it’s one of those “you had to be there” type things.

But then I ran into a problem…I used it all up.

So I went back to drinking regular Joe.  It wasn’t the same.  Once my body got used to the good stuff, I couldn’t go back.  I actually just had some crap coffee as I’m writing this and I’m feeling sluggish already.

Needless to say, my order of Upgraded Coffee can’t get here soon enough.

Of course, there are other components to energy like diet and exercise, but it terms of having a quick and easy hack for staying alert, this is hands down the best thing I have found.

If this interests you, check out the Bulletproof Executive website (affiliate link).  It won’t cure shitty trading, but it can help ensure that you don’t lose money because you fell asleep on your keyboard, again.

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The millions of dollars, the cars, the planes, the houses…they are not about money.

If you walked through any scenic town in the world, would the experience be the same if you had 5 million in the bank or only $50 to your name?

Is spending $200 on a play where you have wear a tuxedo just to take a nap a better experience than spending $7 on a beer atop the most amazing vista in the world?

How much is this worth?

You don’t really want money.

Working a 9 to 5 job for $2 million a year or being free to go anywhere in the world on $75,000 a year?  I’ve never heard anyone describe visiting the water cooler as a life changing experience.  But I guess it could be…if you are boring enough.

Does that Porsche 911 really make your Johnson bigger?  Depends on who is sitting in the passenger seat.  But it is one hell of a lot of fun to drive…with or without a passenger.

You don’t really want money.

But figure out how to get it as much as you can.

Do it to be closer to your family….

Do it to experience the best the world has to offer…

Do it in the name of adventure and going really fast…

Do it so you have a choice of who you hang out with everyday…

…Because…

You want the freedom and amazing life experiences money can buy.

So concentrate on getting what you really want.

Money is just the vehicle.

What do you want? Let me know in the comments below:

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Photo credits: El Frito and deege

Drinking this mixture gives me about 5 hours of energy and true to the claims, I have also lost 6 pounds since starting to drink it regularly.  The energy is not a jittery type of boost either, it is surprisingly even.  This is because it does not rely on caffeine and sugar.  Check out what I mean:

As I mentioned in the video, I am currently using regular coffee, just because I wanted to see how it would work.  However, my order of Upgraded Coffee (that is used for Bulletproof Coffee) is on the way and I can’t wait to give it a try because it is supposed to be even better.  Here is a link to the recipe on Dave’s site, the explanation of the ingredients and why Upgraded Coffee is way better than Starbucks.

As if you didn’t know that already…I actually prefer Folgers to Starbucks.

What do you think?  Have you tried this before?

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Here is the third commercial in their “basement trader” series.

Having your girlfriend do this while you are trading is probably the best way to lose all of your money trading.  If you haven’t seen the other videos, you can see them here and here.

Have you seen any funny trading videos lately?

After watching them, I decided to post them here because I felt that they are very educational.  Rudy is right in that we should be learning from successful people in all areas of life.  Just because we want to be successful traders, does not mean that we only have to learn from other traders.

In this PBS video, rapper Jay-Z (Shawn Carter) is interviewed by Charlie Rose and he gives a very candid account of his life and his rise to Rap superstardom.  What I found most interesting was that Jay-Z developed a passion for writing at an early age and he would be thinking about stories constantly.  This practice and repetition is one of the things that ultimately made him successful. Sound familiar?

Anyway, even if you are not into Hop Hop, I think you fill find it interesting.  Check out the 5 part series here:

Part 1

Part 2

Part 3

Part 4

Part 5

What do you think?

A lot of whipsaws of course.  So what is the cure?  Write a song…of course!  This video cracked me up.

I also really liked it because it wasn’t just some dude standing in front of a overhead projector teaching you a setup.  It’s pretty nerdy, but if you really love to trade, I think you can identify with it.

Too bad this is the only video that he uploaded.

In this post, I will show you something that is not only the the ultimate trading room accessory, but a very good iPhone app too.  It is a beer launching fridge.  I’m sure you have seen these before, but this one has a little twist.

I can be controlled by your iPhone!  Now you never have to get up from the screens because you can have your beer delivered air mail at the push of a button.  Always cold, always refreshing.  Ahhhh…

Of course, this will probably lead to a decline in your profits and hey, let’s face it, you are drinking out of a can.  OK, so maybe this isn’t the best thing you can have in your trading room.  But definitely in the living room, aimed at the couch!