Backtest vs Forward vs Live

For those that do not have a live account, you may not realize that most likely the swap rates in the demo account are not the same as the swap rates your broker is using live. Call your broker up and ask them if the swap rates in their demo's are the same as thier live accounts. Most are using the default metaquotes swap rates that are close to 1-1. Most brokers are more like 3-1. It WILL make a difference if you ever go live and you're using an EA. Also, ask if the demo and live feeds are the same or at least comparable. For example, the demo feed at my broker has about 75% more volume than the live feed. All those extra signals coming into the demo account do make a difference in EA performance.

Brokers are not giving us demo's that truly reflect their live accounts. It's time we start holding their feet to the fire and get these demo accounts fixed.

Be aware also that the backtester doesn't even have swap included in any of the calculations. It makes a big difference and needs to be programmed in by metaquotes. These are just a few of the reasons EA's fail live and results differ so much from the demo.

Brokers will never give us live feeds identical to their demo feeds. Too many factors differ.

Requoting, server load, actually having it run through a dealing desk.

I don't know of any company that would spend the resources requoting demo orders to give you a live look and feel. Demo's are usually on a feed that is as cheap as possible. Actually, I worked for a brokerage once that kept it's Demo feed on a separate "trial" feed it had gotten from another company. It was pretty sad, they kept renewing their free trial refusing to pay for a demo feed. That company is no longer in business, rest assured.

Don't know the motivation to set your swaps to vary between live and demo. It's most likely a case of not bothering to update swaps. Swaps change regularly, based on currency interest rates. The server needs to be updated manually with the new swaps. A company might do this in the beginning, but then focus more and more on the live side of things while letting the Demo server do whatever it wants.

I agree, I think backtesting will give one a decent picture on what to expect from a system, but actual results will vary.