Have you ever, as a trader of foreign exchange, found that your demo account works pretty fine until you go live with the broker of your choice? I have, and with a great deal of frustration too. The question here is why does this happen? Why do trades go well on demo accounts and the same strategy fails on a live one?

I think, after 7 years of trading on demo and live accounts, that I have the answer to my questions. All brokers, even the ones that claim to be Straight Through dealers have a way of fixing the scales. The reason is that they are trading against you and all your winning trades lead to a bit of loss to them. So, it is in their interest for you to lose!

I had opened an account with UWC Forex and funded my account with 100 USD as a special New Year's bonus from my payment processor. Before I funded the account all my trades were going well according to my trading strategy. The minute I went real my strategy went absurdly wrong! A strategy that works fine for 3 years just can't go wrong like that. However, I must admit that the first few trades, 10 in a row, were winning trades and I was really excited seeing real money coming in. Then I realized that I was working on the minimum leverage of 1:10 and put in a ticket to increase my leverage to 1:500. That's when my strategy began to go wrong.

After the increase of leverage I did make 3 consecutive winning trades, but then the system began to ask for re-quotes and would take over 35 seconds to fill my orders. Sometimes when the orders were filled it would be too late. I open positions and wait for 2 to 3 minutes to cover the spread and take out 3 to 6 pips per trade - sometimes just 2 pips - before closing the position. Chatting online with support got me no answers - naturally.

My trading strategy that worked well on demo accounts on different platforms, started to go bad. When my signals indicated that I should buy the prices would move in the direction I expected them to move - IF I never placed an order. IF I placed an order, the prices would move in the OPPOSITE direction that I expect them to according to my trading strategy.

This led me to believe that the system was being fixed. Even the spreads would greatly vary when I placed an order leading to lesser profits or losses.

I believe my system is pretty good, with 80 percent winning trades and 20 percent losing ones, but I can work on the strategy to lessen that gap too. I feel that I need to open an account with an ECN broker. But the only credible ones I have found require 20,000 USD to get started!

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