Though trading in demo mode is useful to teach you the basics about how forex trading is done, trading with virtual funds eliminates the risk factor, i.e. you are taking trading decisions without having anything to lose, without incurring any real monetary losses is it all goes wrong. Therefore, your emotional state of mind is different and tends to be much more reckless and impulsive. On the contrary, when you trade using your own funds and real money is at stake with each transaction and bid placed in forex trading, this forces you to be much more careful and better weigh each move, in order to ensure that you will not end up losing your money. Therefore, it could be argued that the best method to effectively and efficiently learn is trading under real conditions and using real funds, but start by using small amounts so that your risk level is mitigated and kept to a minimum level that you can tolerate.