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Best Demo platform = Best Real Platform?

  • #1
  • First Post: Oct 24, 2011 2:52am Oct 24, 2011 2:52am
I have been trying different trading platforms on different brokers (demo accounts). I am trying to figure out what platform is the most convince for a trader. So far I haven't found anything better than the MT4, though it has some minuses.
Right now I have a live account at ACM and I am trying the demo mt4 of Sunbirdfx and Oanda. Can a demo account can give me the real picture of how the platform works on a real account ? thanks
  • #2
  • Oct 24, 2011 11:00pm Oct 24, 2011 11:00pm
A demo can give you a good idea of how reliable the broker's technology may be and how the features of their platform work but beyond that, a demo is a perfect trading environment that does not mimic true trading conditions. For instance, say you want to place a trade for 10 lots at a certain price. On a demo, it'll get filled every time but in live trading, you may experience slippage in the price rather often resulting in an order for one price and an average fill at a much worse price.

Demo accounts do not provide any insight into liquidity in the market which for a beginning trader might not be a big issue but for traders moving larger lots (or even as little as one or two full lots) may be a primary concern.
  • #3
  • Oct 26, 2011 4:10am Oct 26, 2011 4:10am
Quoting Wacky Canuck
A demo can give you a good idea of how reliable the broker's technology may be and how the features of their platform work but beyond that, a demo is a perfect trading environment that does not mimic true trading conditions. For instance, say you want to place a trade for 10 lots at a certain price. On a demo, it'll get filled every time but in live trading, you may experience slippage in the price rather often resulting in an order for one price and an average fill at a much worse price.

Demo accounts do not provide any insight into liquidity...

Hi Wacky Canuck thanks for your answer. That what I thought- I am sure that there is a significant difference between demo trading and live trading. I might just open a mini account of $100 at on of the brokers that I mentioned.
What do you think about the MT4? do you work with it?
  • #4
  • Oct 26, 2011 4:54am Oct 26, 2011 4:54am
Quote
Best Demo platform = Best Real Platform?

No, no and one more time no! Execution speed will be different.

Demo trade path:

You >> MT4 >> Broker >> Trade has been placed.

Live trade path:

You >> MT4 >> Broker >> Liquidity Provider >> Trade has been placed.

Demo and live can't be equal!

Regards,

Josef
  • #5
  • Oct 26, 2011 7:32am Oct 26, 2011 7:32am
Hi,

There is no connection at all between Demo and Real.

Main difference is in order execution.
If you execute order at Demo it instantly jumps in the order book of broker, so you get exactly your price.
If you do the same on Real, your order goes to broker and then to OTC market order book. Both of these ways can slower execution of order due to latency. Thats called slippage. You just press buy, but order is executed 3 secs later with worse price. Funny thing is, when there is a really bad broker you get slippage always agains your trade.

Order execution issue goes even further. There also may be no counterposition in real market. In demo, it is unlimited liquidity, but in real while everyone is panic selling (for example), you may not get position you want.

Taxes
You pay no taxes on Demos . Usually not even brokers want you to pay taxes, you have to report to authorities yourself.

I dont know which broker to recommend. I personally choosed Onanda, as they have loads of clients = liquidity and low spreads. But it is Ltd. company, which is kinda funny. Hard to pick the best broker. If I was willing to put more cash into FX, I would be separating them between several brokers. Any of them can go bankrupt.

T.
"I know one thing, that I know nothing." Sokrates
  • #6
  • Oct 26, 2011 8:50am Oct 26, 2011 8:50am
Quoting VincentG
Hi Wacky Canuck thanks for your answer. That what I thought- I am sure that there is a significant difference between demo trading and live trading. I might just open a mini account of $100 at on of the brokers that I mentioned.
What do you think about the MT4? do you work with it?


I work with MT4 and like it but unless you need it specifically, I would recommend looking into other platforms like tradstation or ninjatrader. It depends on how you wish to use it. I have commercial and private EAs that are coded in MT4 so that's why I use it but for manual trading, tradstation was always my favourite.

Whatever the case, if platform is a major concern for you, check out what different brokers have to offer.
  • #7
  • Last Post: Oct 31, 2011 2:32am Oct 31, 2011 2:32am
Quoting Tom_D_Trader
Hi,

There is no connection at all between Demo and Real.

Main difference is in order execution.
If you execute order at Demo it instantly jumps in the order book of broker, so you get exactly your price.
If you do the same on Real, your order goes to broker and then to OTC market order book. Both of these ways can slower execution of order due to latency. Thats called slippage. You just press buy, but order is executed 3 secs later with worse price. Funny thing is, when there is a really bad broker you get slippage always agains your trade.

Order...
Hi. So I kind of understand from you guys that mt4 is the most common platform for forex traders. Wacky, I have never heard of ninjatrader, what is the benefit of their platform?
Hey tom..I understand that the execution issue is the most important here. Is that has something to do with a term that I just head- ECN? something about trading directly to the market's huge banks.. is it relevant? both oanda & sunbirdfx claim to be ECN brokers. How can I test that?
Thanks all! you are very helpful
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