Module 1: Start Here · Lesson 7 of 7 · Back to course
You’ve learned what trading is, how a trade makes or loses money and the language you’ll meet. Now it’s time to place a trade – with pretend money. This lesson walks you through a first trade on a demo account, step by step. Every platform looks a bit different, so we describe what to look for rather than which buttons to press on any one platform.
Before you start
- Use a demo account from an FCA-authorised firm. Check the firm on the FCA Register first. We don’t recommend any particular provider in this lesson.
- Spread bet or CFD demo? UK firms usually offer both. The mechanics of placing a trade are almost identical. The main difference is size: spread bets are in £ per point, CFDs in contracts or lots. See How a trade makes or loses money.
- Set the demo balance to something realistic. If you’d only ever trade £2,000 for real, set the demo to £2,000, not £100,000.
- Remember what a demo can’t show you: real emotions, and sometimes real fills and slippage.
Step 1: Pick one market
Choose one liquid market with a small spread, such as the FTSE 100 (often shown as “UK 100”) or EUR/USD. Check it’s open – the FTSE cash market is busiest during London hours. Don’t hop between markets on your first day.
Step 2: Open a chart and decide the idea
Open a chart on a timeframe you can follow, such as 15-minute or 1-hour. For a first trade, the idea can be simple – this is about learning the mechanics, not finding a great setup. Write down in one sentence:
“I’m buying (or selling) because , and I’m wrong if price goes to .”
Step 3: Decide where your stop goes
Put your stop where your idea is wrong – for example, just beyond the last swing low for a buy. Measure the distance in points or pips.
Step 4: Work out your size
Decide how much you’ll risk. A common beginner rule is 1% of the account (see the 1% rule).
- Spread bet: stake per point = £ risk ÷ stop distance in points.
- CFD: contracts = £ risk ÷ (stop distance × value per point of one contract). Check the contract value in your platform’s market info.
Step 5: Fill in the order ticket
Open the order ticket (sometimes called the deal ticket). You’ll usually see:
- Direction: buy (long) or sell (short).
- Order type: “market” fills now; “limit” or “stop entry” waits for a price.
- Size: £ per point or number of contracts.
- Stop-loss: enter the price or distance. Note whether it’s a normal or guaranteed stop (guaranteed stops usually cost extra).
- Take-profit (limit): optional, but practise setting one.
Read the ticket back before clicking. Check the margin required and the estimated loss if the stop is hit, if the platform shows them.
Step 6: Place it and check it
Click to place the trade. Then open the positions panel and check: direction, size, entry price, stop and limit. Beginners regularly find they bought instead of sold, or typed 20 instead of 2. That’s exactly the kind of mistake a demo is for.
Step 7: Manage it – by doing nothing
Don’t move your stop further away. Don’t add to it. Let it hit the stop or target, or close it at a time you decided in advance.
Step 8: Close it and record it
To close early, use the close button on the position (on some platforms you place an opposite trade of the same size). Then write it up in your journal: market, direction, size, entry, stop, target, result in £ and in R, and one line on what you learned.
Example (illustrative numbers)
All figures are made up for teaching purposes. They aren’t real prices or a trade idea.
Demo balance: £2,000. Risk 1%: £20.
Spread bet: the UK 100 is quoted 8,000.0 / 8,001.0 (1-point spread). You buy at 8,001.0 with a stop at 7,981.0 – 20 points. Stake = £20 ÷ 20 = £1 per point. Target 8,041.0 (40 points, 2R).
- If the stop is hit: −20 points × £1 = −£20 (−1R), plus any slippage.
- If the target is hit: +40 points × £1 = +£40 (+2R).
- Exposure: 8,001 × £1 ≈ £8,001. At the UK retail limit of 20:1 on major indices, margin ≈ £400.
CFD: same idea, but suppose one contract is worth £1 per point. You’d buy 1 contract – the same £20 risk.
Notice the exposure: about £8,000 controlled with £400 of margin. That’s leverage, and it’s why size matters so much.
The prop firm angle
Prop firm evaluations run on similar platforms. Mis-typed sizes, missing stops and confusion over order types are real ways people fail on day one. Practise placing, checking and closing trades on demo until it’s boring – before you pay for any challenge.
Key takeaways
- Use a demo from an FCA-authorised firm, with a realistic balance.
- Decide the stop first, then size the trade from it.
- Check every order in the positions panel after placing it.
- Journal every trade, win or lose.
Quick quiz
- Risk £30, stop 15 points. What’s the spread bet stake? (£2 per point.)
- What’s the difference between a market and a limit order? (Market fills now at the best price; limit waits for your price or better.)
- Why set a realistic demo balance? (So sizes and habits match what you’d really trade.)
- What should you check straight after placing a trade? (Direction, size, entry, stop and target in the positions panel.)
- A trade risks £20 and makes £50. What’s the R-multiple? (+2.5R.)
Key terms
Demo account · Order ticket · Market order · Limit order · Stop-loss · Stake per point · Margin · R-multiple
Try this
Place five demo trades this week using the eight steps. Use a fixed 1% risk on each. After each one, write down any mistake you made with the platform, not the market. Aim for five trades with zero platform mistakes.
FAQ
How long should I stay on demo? Longer than you think. Most courses suggest at least a few months of consistent, rule-based demo trading. See How much time and money do you really need?
Is a spread bet demo or CFD demo better to start with? Either is fine for learning mechanics. Spread betting sizes in £ per point are often easier for UK beginners to follow. Tax treatment differs – see our UK tax guide.
Do demo accounts expire? Some do after a set period. Check with the provider.
Disclaimer: This page is general education, not financial or investment advice or a personal recommendation, and it doesn’t take your circumstances into account. Examples are hypothetical, for illustration only, and not an invitation to buy or sell. Learning a strategy doesn’t guarantee profits. Past performance is not a reliable guide to future results. Futures, spread bets and CFDs are complex and carry a high risk of losing money quickly because of leverage, and most retail traders lose money. With a real futures account, losses can exceed your deposit. Only trade with money you can afford to lose, and speak to an independent FCA-authorised adviser if you’re unsure. Read our full risk warning.