What's the difference between a demo and live account?

I’ve been trading demo for quite some time with ok results. I’ve also been trading live. Somehow my results are different when trading demo vs trading live. I guess it’s psychological but are there any differences between a demo and live account?

For most (new) traders, yes there is an emotional reaction to winning and losing money on a live account. Humans have evolved to avoid pain at all costs. That’s why traders nurse losing trades, but cut winning trades when it should be the other way around.

Thus you need to recognise the emotional signal, and manage the response. And why many cannot, thus failing to become successful.

If you are following price action on your open trades, use a trailing S/L with the aim to reach breakeven. Then you could take a portion profit and let the remainder run to the next profit level. That’s simpliest.

Pro traders (with large accounts) would likely add to their positions, but for newbies with small accounts, that’s emotionally difficult.

As for losing trades, just cut them short. Do not let the market prove you wrong. I hate to lose any trade, but I hate to lose big, more so. There’s always another trade waiting.

I hope that helps. Best of luck.


Hi Zianfx, there is no difference between demo and live account. the data feed is the same. There is a difference with trade execution regarding commission and commission free accounts.

All in your own mind. Humans are risk averse by nature and overcoming that is often the trader’s biggest battle.


Well traders also take a lot more risk in demo accounts compared to live accounts cause they are trading with fake money and not their own.

What kind of trading do you use? can you tell us more about your strategy?

Hello Zianfx, Demo trading is mostly used by new traders, but you can do live trading if you know How to trade Live. Following are some of the differences I found while researching demo and live trading. I hope it helps you.

  • Demo trading is similar to playing a video game on your computer. Everything you do in the demo remains on your computer, and the price you request becomes your price. However, When trading in live, there may be a gap between what you expect and what you get.

  • Demo trading can create an unrealistically favorable trading environment that does not exist in live trading when the trader’s account funds are on the line due to a lack of emotional commitment when no real money is on the line.

  • Failure to stick to a trader’s trading plan has no practical consequences. As a result, a trader’s discipline-related behaviors may grow, costing them money when trading live.

  • When trading in a demo account, traders may be tempted to overtrade or under-evaluate risk. When they transfer to real trading, this behavior could have major negative effects.

Every member answered the question with a different view. With most people the intent can not be so strong ,with demo.Would you painstakingly wait hours for the Asian markets to open,losing hours of sleep ,so you don’t get spiked out with the widening of your spread , :yawning_face::joy:

A demo account is for educational purposes only and does not ensure your success in forex. You do not have to worry about losing anything from your actual money. The live account, on the other hand, is meant for real-money trading.

Demo great practicing for months, maybe years strategies, to get a real feel for the charts ect ,but in reality it like playing poker with matchsticks

Yep it will be psychological mate.

Demo trading, you don’t feel it - as it’s not your money that you are playing with.

A live account means that it’s live, i.e. it has real money involved. You trade real money and you gain/lose real money. A demo account is a kind of dummy account, where you can trade with virtual money without risking your capital. Live account can help you gain valuable experience in the real world of forex trading. Demo accounts are also useful, but they can’t give you the kind of exposure and experience as that of a live account. As a live account has real money involved, therefore it has more risk of losing money than in a demo account.

Demo is an account funded with virtual cash given for practicing. Contrarily, live account is an account funded with real cash. Demo is used for practicing but live is used for earning.

Imagine this, you send your children to school, and years later, someone will have to explain to them what this guy just explained.

Maybe i should also explain that in a demo account you won’t be able to whitdraw your money. Just in case you where wondering.

The major difference between live and demo accounts is money and emotions. In live trading, we trade real money and it can make us successful traders. Live trading is risky and we feel the loss deeply. In demo trading, we do not trade real money and hence do not grieve if we lose out trades. Also, demo trading is simply meant to practise, it cannot make you rich.

Yeah, that’s pretty much on point. However, live account like micro can also be used to practise trading with real money for minimum risk as well cause demo account won’t prepared you for the psychology aspect of trading which you only feel when you put your real money in.