How it works. Almost every broker offers traders participation in their tournaments, although you can call it earnings only indirectly. Participation in tournaments in almost 99.99% of cases gives the trader only money as bonuses that can be spent on trading but can not be withdrawn to live currency. Tournaments can be daily, weekly, monthly, etc. – Depends on the policy of the broker. In most cases, tournaments are held on demo accounts, but there are competitions for existing traders (whom no one forbids to participate in tournaments on demo accounts) and partner competitions.
- A ghostly opportunity to still get real money (in exceptional cases, this is possible).
- Self-assessment. Competitive trading, even on a demo account, stimulates and adds excitement. There is an opportunity to do a comparative analysis of your strategy with the strategies of other traders.
By participating in forex tournaments and contests, the trader does not lose anything but time. There is some chance of victory: professional traders prefer real accounts with real money, so most likely you will have to fight with the same inexperienced beginners, 50% of whom will leave the race before the end of the tournament.
From theory to practice. A good example is a contest on demo accounts “Best of the Best”. Its general conditions are as follows:
- Participation is completely free, you do not need to deposit money into your account!
- The tournament starts on the 1st of every month and lasts until 23:59 of the last day of the month. Each trader who has submitted an application for participation in the competition in the current month automatically falls into the list of participants in the competition, which starts on the 1st of the next month. Each trader can participate in the competition an unlimited number of times, but in the current tournament, he is allowed to register only one account.
- Each participant receives $5,000 on a demo account. In the USA, trading is conducted on any instruments without restriction in strategies (if they comply with the “Client Agreement”).
- Prize fund – 10 thousand dollars. The USA, which is distributed among the 5 winners. 4000 dollars USA. – 1st place, 2500 and 1500 dollars. – for the 2nd and 3rd place, at 1 thousand dollars. USA – participants who took 4 and 5 places.
The trader receives prize money in his real trading account, but it cannot be withdrawn to cash. They are a springboard for trading and give the winner the opportunity to participate in the Social Trading service. But unlike a demo account, profit from prize money can be withdrawn to live currency.
Traders who have active accounts can also take part in this contest, but there are other offers for them, which you need to read more about.
Pros. There is no financial cost, there is a chance to get rewards for winning. The atmosphere of healthy competition encourages more informed and responsible decisions.
Cons. The probability of victory is low, the risk of losing time remains. However, if a trader is already aimed at gaining experience on a demo account, this is not considered a disadvantage. The psychological risk remains: receiving a bonus can become a trigger, thanks to which a potential trader will become a broker client. If we are talking about “kitchen”, then the tournament is a marketing move, the task of which is to push the trader to replenish the deposit.