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Demo vs Real.

Rigol. (danielsoy)
Jun 07 2015 at 15:58
36 posts
Hi ppl.

Would like to know if someone may point me, the basics differences between real and demo accounts.


What things that are possible in demo, are not in real.




Thanks a lot.
Niels
BOAR
Jun 08 2015 at 07:11
18 posts
I think the biggest difference is that demo accounts typically do not take into account market depth.
This would mean that if you're placing big position sizes (let's say north of 5 to 10 Lots depending on your broker), you'll get filled at different quotes on Demo server than on the Real server, and the Demo quote will always be better than the Real quote.

Another difference you might see and which could impact your trading strategy, especially if it's a scalping strategy, is that demo trades do not get commissioned in contrast to real trades. Again, this depends on your broker.

The spread and the charts should normally be the same.
cenetti
Jun 11 2015 at 06:54
9 posts
I am using FXCM demo and real both mirror each other. Both the same. No difference whatsoever.
WU LIUH JING (StingRay)
Jun 11 2015 at 07:44
21 posts
thanks for your information.

i will try use FXCM.


financial freedom by using own hand make EA.
Renko (Freerenkosignals)
Jun 13 2015 at 15:16
8 posts
This is a very interesting topic. I think the most important factor here is the 'emotional side of trading', many times people tend to make mistakes when using a real account, mistakes which may not necessarily happen if they were using a demo. This is due to the fact that there is added pressure put on the trader and added risk since he/she can now lose REAL money. There is added risk involved now and this risk is not so much about money management BUT the very fact that the trader now uses his/her strategy on real cash with real losses and indeed real profits. It is totally one of emotions.

In short:

DEMO = Nothing to lose
REAL = Everything to lose (well at least all the cash on deposit)

On the other hand I guess it depends a lot on the broker, sometimes brokers do have slight differences between there demo and real accounts as Niels pointed out above. At the same time there are many brokers out there where there are no differences from real and demo accounts. I personally trade real accounts as well and the demo in my profile gets all the trades as in the real accounts. So far I have gotten no problems with this.
Ari Goldman (arigoldman)
Jun 15 2015 at 10:13
909 posts
The main difference is your emotion. Sometimes that's all that matters.
Alex
Look009
Jun 19 2015 at 13:19
224 posts
In general, if you do not trade real money you can afford afford yourself pretty bigger risk... human psychology...
cenetti
Jun 21 2015 at 10:02
9 posts
Emotions and human psych plays a role if all you play is unrealistic amounts of demo money with very high leverage. Open a $1000 demo account 50:1 - see how far can you get. Of course you can't duplicate the same performance with real money when your demo account has 1:500 lev with $1,000,0000 balance.

My demo account is my signal account. All my strategy runs on it. I have a real account with the same balance mirrors it. And then I have an E*trade forex account which I mirror (manually) from demo signals because it's different platorm (marketscope II)

All works flawlessly. I lose a pip or two when i enter my marketscope trades manually but that's ok. I am not shooting for less than 10-15 pips a trade.

rob559
Jun 22 2015 at 16:36
1916 posts
with quality brokers the difference is not that pronounced, the differnce is slim...not hard to find one
FxMasterGuru (FxMasterGuru)
Jun 22 2015 at 17:39
1608 posts
For the first few weeks or months the difference could be slim... But then most brokers attach their 'virtual dealer plug-in' parasite software and the difference will be significant. Especially for scalpers.
Please click "Vouch" if you liked my post. If not, just put me on your Blocked list. :o)
Alex
Look009
Jun 28 2015 at 06:27
224 posts
Hi FxMasterGuru, very interesting indeed.. Price feed can be locally manipulated thus...
Damien (Damien1881)
Jul 28 2015 at 12:11
24 posts
If your trading Longer time frames like daily and weekly I don't think it matters does it? it's only really a relevant issue for intra day and scalpers, please feel free to correct me if I'm wrong?
Don't listen to and follow the BS online.
FxMasterGuru (FxMasterGuru)
Jul 28 2015 at 13:22
1608 posts
In theory you are right, but there are some special circumstances.

For example: if your Stop Loss is triggered by a major news spike, then your demo account will get the fill at the same exact SL price where it had been set.

On the other hand: your real account's Stop Loss could be filled 100+ pips away easily... Or 3000+ pips away like it happend on January 15th during the SNB announcement. I have seen it myself first hand... and not only once...

So, if you worked on larger timeframes with larger Stop Losses (especially on the 'minor' pairs), then once in a while your SL would be triggered by SPIKES (or gaps) with HUGE slippages which can have a significant negative effect on the overall results.
Please click "Vouch" if you liked my post. If not, just put me on your Blocked list. :o)
IXBONE
Jul 28 2015 at 15:41
97 posts
Personal i think it doesnt matter in long term tf >H4 if demo or not, tick are nearly the same, spikes, gaps, spreads, interests too, because demoservers connects to the origin quoteserver to get the rates.
The one and only difference is the 'virtual dealer plugin' where the broker can semi-automatically set some 'special' settings against you. :) This plugin is not active in demoservers. This is the residual risk, but with some security features you will survive (the broker).
Damien (Damien1881)
Jul 28 2015 at 21:49
24 posts
FxMasterGuru posted:
In theory you are right, but there are some special circumstances.

For example: if your Stop Loss is triggered by a major news spike, then your demo account will get the fill at the same exact SL price where it had been set.

On the other hand: your real account's Stop Loss could be filled 100+ pips away easily... Or 3000+ pips away like it happend on January 15th during the SNB announcement. I have seen it myself first hand... and not only once...

So, if you worked on larger timeframes with larger Stop Losses (especially on the 'minor' pairs), then once in a while your SL would be triggered by SPIKES (or gaps) with HUGE slippages which can have a significant negative effect on the overall results.

Thanks, I overlooked news slippage, I think we all remember the recent CHF spike, I think I overlooked it because I use limit orders basing my entries on daily and weekly chart / technical analysis, so for me, the slippage actually gives me a better price on a live account which would only improve my results compared to demo testing.
I don't use stops but instead a very conservative lot size grid set based on the ADR of that pair.

As I'm able to Vouch you'll have my vote.
Don't listen to and follow the BS online.
FxMasterGuru (FxMasterGuru)
Jul 28 2015 at 21:56
1608 posts
Thanks for your Vouch, Damien! 😎

So a crucial point can be the slippage of the Stop Losses on REAL accounts during news spikes (in contrast to demos), which I have seen on my live accounts a few times.

It is partly due to the fact that newstraders absorb the thin liquidity very fast, so Stop Losses can be filled very far from the expected price, where there is some dense liquidity again.
Please click "Vouch" if you liked my post. If not, just put me on your Blocked list. :o)
IXBONE
Jul 28 2015 at 22:03
97 posts
FxMasterGuru posted:
Thanks for your Vouch, Damien! 😎

So a crucial point can be the slippage of the Stop Losses on REAL accounts during news spikes (in contrast to demos), which I have seen on my live accounts a few times.

It is partly due to the fact that newstraders absorb the thin liquidity very fast, so Stop Losses can be filled very far from the expected price, where there is some dense liquidity again.

Nope, compare CHF spike demo and real, both are equal, because demo server get their quotes along with the real account from one quoteserver!! the difference is the metaquotes 'virtual dealer plugin' which is not active on demo servers, million demos...so plugin useless.
Next, StopLoss is alway the hard way to realize a loss, this is 'old school', there are several new technics available to survive CHF spikes easy
FxMasterGuru (FxMasterGuru)
Jul 28 2015 at 22:22
1608 posts
Well, I have to disagree.

On DEMO accounts:

1. Liquidity is limitless and
2. Executions are instant, so DEMO orders get decent (i.e. reasonably good) fills even during new spikes (i.e. just some minor slippage).

On the other hand on REAL account executions can slip easily during major news DUE TO:

1. LACK OF LIQUIDITY and also due to
2. BROKER SERVER OVERLOAD causing significant EXECUTON TIME DELAYS.

It is important to emphasize that these are NOT due to Virtual Dealer Plug-Ins. It is simply how markets and brokers function during times of high volatility and thin liquidity.

Each of the above TWO phenomena can be detrimental during news events on REAL ACCOUNTS, but TOGETHER, they are the 'Perfect Storm'. If we add Virtual Dealer Plug-ins to the equation, then we get the 'Super Perfect Storm'.

This is why NewsTrader EAs work so well on DEMO accounts and they fail miserably on REAL accounts.
Please click "Vouch" if you liked my post. If not, just put me on your Blocked list. :o)
IXBONE
Jul 29 2015 at 01:27
97 posts
Real and Demo use the same quoteserver at the same broker!

If there is a lack of liquity, both real and demo have the lack of liquity, because both have the same tickdata, spikes, spreads!

If the quoteserver or orderbookserver is overloaded, real and demo will have equal delays, because both use the same server at the same broker!

The virtual dealer plugin is the broker option to handle semi-autom. against you.

if you use real at broker 'A' and demo at broker 'B' you must have different tickdata, because each uses it own clearing bank(s)

As long you use real and demo at the same broker you'll have nearly the same tickdata - and a tick is a tick, there is no volatility, requote, spike inside of '1' tick!
Rigol. (danielsoy)
Jul 29 2015 at 06:30
36 posts
So is virtual dealer, something real, or just an urban myth?

Isnt it against the law, or pretty legal actually?
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