So if you believe, as I do, that demo accounts do more harm than good, the next logical step is to suggest the mini account right? I mean, the mini account has skin in the game so it has to be the answer.
I don’t think so and have written a few common conversations to uncover those hidden traits that can really harm you.
Guest post by Matthew Carstens. Founder of Rogue Red, Creator of TradingWheels
Conversation #1: A common conversation between couples
“Honey, can you pick up a gallon of milk on your way home?”
“Sure, I’ll pick it up next door when I leave.”
“No, don’t do that. They are too expensive. Just grab it at the gas station instead.”
< Later that night >
“Hi Honey, I’m home.”
“Hi, did you pick up the milk I asked for?”
“Yup”
“Well what is all of this other stuff then?”
“Oh, well it was so cheap I figured I’d get more.”
Conversation #2: Mike and Larry walk into a casino
“Larry, lets go to those tables over there.”
“Mike, you go ahead. I am going to play on these cheaper tables.”
“Oh, ok. What, did you not bring enough cash?”
“I just figure I’ll practice on these cheaper tables first until I prove to myself I can play on the more expensive ones.”
“Oh, OK, good luck.”
“Hey Larry, what are you doing at the bar already?”
“Ahh, well I lost everything I brought in. I’m done for tonight.”
“What do you mean you lost it? I thought you were on the cheaper tables?
“Yea, well I started small and was doing alright but then… I don’t know… I lost control and just started betting bigger on those tables than what I initially intended.”
“Why did you do that, I thought the whole point of starting on the cheaper tables was to practice?”
“Yea, I know. I messed up. I started to get bored because the amount didn’t mean anything to me, so I pressed a bit and then started losing. I knew I had more money in my pocket and just lost control of myself until it was too late.”
In both of these cases, we can see people trying to be prudent thinking smaller pieces can save them money (like a few mini lots), but later on realize they spent the funds they were trying to protect in the first place.
There is a better way.