Are demo accounts at all different than live accs? | Forex Factory

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Are demo accounts at all different than live accs?

  • #1
  • First Post: Nov 6, 2007 5:43pm Nov 6, 2007 5:43pm
I am asking because it doesn't seem hard to make money on my demo account. I was thinking maybe brokers make demo accounts purposefully easier than live because it would encourage people to go live. Anyone that has had a live accounts reply would be helpful.
  • #2
  • Nov 6, 2007 6:04pm Nov 6, 2007 6:04pm
Quoting MattL4417
I am asking because it doesn't seem hard to make money on my demo account. I was thinking maybe brokers make demo accounts purposefully easier than live because it would encourage people to go live. Anyone that has had a live accounts reply would be helpful.
Yes demo don't factor in liquidity.
  • #3
  • Nov 6, 2007 6:55pm Nov 6, 2007 6:55pm
Quoting turbokaos
Yes demo don't factor in liquidity.
Right. Your demo orders will always get filled at the posted price, at least with most brokers. Not because the broker is purposely trying to make it easier, but simply because there is nothing actually being traded. It doen't matter if they can match your order or not.
You may also see glitches in your demo that aren't on the live platform. More time and effort is expended on keeping the live platform working.

Then there is the human factor. You are going to function differently when trading on a demo than you will when your cash is on the line.
  • #4
  • Nov 6, 2007 9:04pm Nov 6, 2007 9:04pm
Quoting billflet
Right. Your demo orders will always get filled at the posted price, at least with most brokers. Not because the broker is purposely trying to make it easier, but simply because there is nothing actually being traded. It doen't matter if they can match your order or not.
You may also see glitches in your demo that aren't on the live platform. More time and effort is expended on keeping the live platform working.

Then there is the human factor. You are going to function differently when trading on a demo than you will when your cash is on the line.
Trade what you see, not what you think.
  • #5
  • Nov 6, 2007 10:12pm Nov 6, 2007 10:12pm
If you are so darn good in DEMO, keep it up. Ask the broker to give you $1M DEMO money and trade it to $1T.

By that time, you will realize it was useless to have traded DEMO.

DEMO is useful to learn the platform; strategy wise, its useless.

Of course Forex GURUs will tell you to trade DEMO first. This is OK. But what I am telling you is, the real education starts when you start LIVE trading.
  • #6
  • Nov 6, 2007 11:59pm Nov 6, 2007 11:59pm
Quoting MattL4417
I am asking because it doesn't seem hard to make money on my demo account. I was thinking maybe brokers make demo accounts purposefully easier than live because it would encourage people to go live. Anyone that has had a live accounts reply would be helpful.
"It doesn't seem hard to make money on my demo account?"
Well, I think it's hard enough try to make money on demo account or any paper trading.
How many trades have you made anyway on your demo account that cost you this confidence? Like some 5,10,25 trades? You should demo or paper at least for hundreds of trades before saying it's easy, then you won't say it's easy neither.
  • #7
  • Nov 7, 2007 8:21am Nov 7, 2007 8:21am
Quoting SomedayIwill
"It doesn't seem hard to make money on my demo account?"
Well, I think it's hard enough try to make money on demo account or any paper trading.
How many trades have you made anyway on your demo account that cost you this confidence? Like some 5,10,25 trades? You should demo or paper at least for hundreds of trades before saying it's easy, then you won't say it's easy neither.
That's a good point someday. I haven't made 100's of trades yet, but the ones I have, just made me think "is it really this easy?" but yes I should really trade more before I make that assumption.
By the way what exactly does liquidity mean as used here?
  • #8
  • Nov 7, 2007 7:40pm Nov 7, 2007 7:40pm
Quoting BurgerKing
By that time, you will realize it was useless to have traded DEMO.

DEMO is useful to learn the platform; strategy wise, its useless.

Of course Forex GURUs will tell you to trade DEMO first. This is OK. But what I am telling you is, the real education starts when you start LIVE trading.

I would agree with BurgerKing, though I disagree that it is useless for the true beginner. Usually I tell students to demo trade for their first 3-4 months. You need to understand the basics of your system, the charts, and how/what affects the currency market before going live with any amount. Only hours spent in front of the charts can teach you these things.

After that, you are ready to begin the other 90% of currency trading. Mastering your own psychology. This part can only start after trading your first live dollar and truly is the majority of the hurdle that is becoming a successful trader.

Personally, I also always hope the first live trade a new student takes is a loss. Overconfidence is as dangerous as anything else in trading. You will have mastered your own psychology when a positive trade being limited out feels exactly the same emotionally as a negative trade being stopped out.
The basis of a democratic state is liberty. ~ Aristotle
  • #9
  • Nov 8, 2007 12:47am Nov 8, 2007 12:47am
When real money is involved you react differently....

It is not the same. At demo as you can stay cool even have huge floating loss. But 10% floating loss in real account can cause a sleepless night...
  • #10
  • Nov 8, 2007 6:24am Nov 8, 2007 6:24am
I have not noticed a difference when I have traded live and demo, but there is a huge mental difference. Your dealing with your own money and that makes you think alot different and if your not carefull, your emotions will get the best of you, you won't stick to your 'rules' and you will end up being a statistic.
  • #11
  • Last Post: Nov 8, 2007 9:41am Nov 8, 2007 9:41am
Re-quotes... when trading live, I deal with re-quotes. In demo, you do not deal with these.
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