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  "kind": "article",
  "key": "demo-accounts",
  "title": "Demo trading account: what it teaches and what it hides",
  "h1": "Demo trading accounts: what they copy, what they leave out, and how to use one",
  "description": "A demo trading account in plain words: what a forex or CFD demo account copies and leaves out, how to set one up like a real account, and when to stop.",
  "keywords": [
    "demo trading account",
    "forex demo account",
    "CFD demo account",
    "paper trading",
    "demo vs live trading"
  ],
  "published": "2026-09-05",
  "updated": "2026-10-13",
  "author": {
    "name": "Gabriel L.",
    "url": "https://thetraderwiki.com/en/authors/gabriel-l/"
  },
  "publisher": {
    "name": "TheTraderWiki",
    "url": "https://thetraderwiki.com/"
  },
  "riskWarning": "CFDs are complex, leveraged products, and the regulators’ own figures show that most retail accounts lose money. Nothing on TheTraderWiki is investment advice. Read the full risk disclosure, and if you’re unsure, talk to a qualified adviser. Broker details can change and they can be wrong. Before you open an account, confirm them with the broker and the regulator’s register.",
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    {
      "name": "Demo accounts",
      "url": "https://thetraderwiki.com/en/demo-accounts/"
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  "lead": [
    "A demo trading account copies a provider’s trading platform and runs on pretend money. You see live or slightly delayed prices, and the order types match those of a real account. Providers give you a demo so you can try the platform before you open a real account. If you use it with care, you learn how a CFD trade works at no cost. A CFD is a contract with a provider that pays out the difference between your open and close price, without you owning the asset. Used carelessly, a demo teaches habits that a real account punishes.",
    "This page covers what a forex or CFD demo account copies and what it leaves out. You’ll find how to set up a demo account to match the account you would really open, along with a practice plan that has a fixed end. It also covers when to stop practising, and explains why demo results almost always look better than live ones."
  ],
  "leadLinks": [
    {
      "label": "CFD",
      "url": "https://thetraderwiki.com/en/glossary/#cfd",
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  "blocks": [
    {
      "type": "list",
      "id": "key-points",
      "heading": "Key points",
      "url": "https://thetraderwiki.com/en/demo-accounts/#key-points",
      "ordered": false,
      "items": [
        "A demo copies the platform, order types and price feed. What it doesn’t copy is how your provider really fills orders or the price gaps around news. The feeling of losing real money and the account size you’d actually fund aren’t copied either.",
        "You’ll only learn something useful from a demo if its balance, trade sizes and costs match those of the real account you intend to open.",
        "A practice plan includes a fixed number of trades, written rules and a record of every trade. The demo teaches you nothing without that record.",
        "Stop practising once your record shows you following your rules. A profit on the demo balance doesn’t tell you that.",
        "Demo results look better than live results because of how a demo works, and the gap is biggest for styles that trade often."
      ]
    },
    {
      "type": "table",
      "id": "what-a-demo-simulates",
      "heading": "What a demo copies and what it leaves out",
      "url": "https://thetraderwiki.com/en/demo-accounts/#what-a-demo-simulates",
      "intro": [
        "A demo copies some parts of a real account and leaves others out. How much its results are worth depends on what it leaves out."
      ],
      "caption": "Features of a real CFD account and whether a typical demo copies them.",
      "head": [
        "Feature",
        "In the demo?",
        "What the difference means for you"
      ],
      "rows": [
        [
          "Platform, charts, order types",
          "Yes",
          "You can learn how everything works"
        ],
        [
          "Price feed and spread (the gap between the buy and sell price)",
          "Usually, sometimes delayed",
          "The demo spread can be narrower than the one you’d pay live"
        ],
        [
          "How orders are filled, and slippage",
          "Rarely",
          "A demo usually fills you at the price you see. A live order fills at the best price available when it arrives, which can differ. That difference is slippage"
        ],
        [
          "Wider spreads around news and at the rollover, the daily cut-off for overnight charges",
          "Sometimes",
          "The price jumps and slippage that come with those moments are usually missing"
        ],
        [
          "Overnight financing, the charge for holding a trade past the daily cut-off",
          "Sometimes",
          "Trades held for several days may look free"
        ],
        [
          "Margin close-out, the rule that closes your trades when your account runs too low",
          "Sometimes",
          "The rule may be missing or set differently"
        ],
        [
          "Account size",
          "No: most demo balances are large by default",
          "Trade sizes you learn on a big balance don’t carry over"
        ],
        [
          "How you react to losing",
          "No",
          "The habits that empty real accounts don’t show up"
        ]
      ],
      "numericColumns": [],
      "links": [
        {
          "label": "spread",
          "url": "https://thetraderwiki.com/en/glossary/#spread",
          "type": "internal"
        },
        {
          "label": "slippage",
          "url": "https://thetraderwiki.com/en/glossary/#slippage",
          "type": "internal"
        },
        {
          "label": "rollover",
          "url": "https://thetraderwiki.com/en/glossary/#rollover",
          "type": "internal"
        },
        {
          "label": "Overnight financing",
          "url": "https://thetraderwiki.com/en/glossary/#overnight-financing",
          "type": "internal"
        },
        {
          "label": "Margin close-out",
          "url": "https://thetraderwiki.com/en/glossary/#margin-close-out",
          "type": "internal"
        }
      ]
    },
    {
      "type": "steps",
      "id": "configure-a-demo",
      "heading": "How to set up a demo like a real account",
      "url": "https://thetraderwiki.com/en/demo-accounts/#configure-a-demo",
      "intro": [
        "Setting up a demo to look like a real account means adjusting five settings. The default demo from a provider rarely lines up with all five."
      ],
      "howto": true,
      "items": [
        {
          "id": "configure-a-demo-step-1",
          "title": "Set the balance to your real amount",
          "text": "Reset or open the demo with the amount you would really deposit. Don’t use the default amount. A demo with a big balance teaches you trade sizes that a real account can’t afford."
        },
        {
          "id": "configure-a-demo-step-2",
          "title": "Size trades by your risk rule",
          "text": "Use the same risk-per-trade rule on your demo as you would on a real account. Work out each trade’s size from the distance to your stop-loss, the price at which you’ve decided to get out. That way the demo tests your rule and the big balance can’t hide a mistake (risk management)."
        },
        {
          "id": "configure-a-demo-step-3",
          "title": "Include every cost",
          "text": "Check that the demo charges the spread, commission and overnight financing. If it doesn’t, use the rates your provider publishes to keep your own tally of the financing each night (costs and fees)."
        },
        {
          "id": "configure-a-demo-step-4",
          "title": "Trade at the same hours",
          "text": "Run the demo during the hours you would trade for real. Make sure that window covers the rollover and any news releases, and note the spread at those moments (forex trading)."
        },
        {
          "id": "configure-a-demo-step-5",
          "title": "Keep the record",
          "text": "Log every trade with the reason, the planned stop, the actual exit and the result. Keep this record in a file outside the platform. That record is the only thing a demo gives you that has value."
        }
      ],
      "links": [
        {
          "label": "stop-loss",
          "url": "https://thetraderwiki.com/en/glossary/#stop-loss",
          "type": "internal"
        },
        {
          "label": "risk management",
          "url": "https://thetraderwiki.com/en/risk-management/#position-sizing",
          "type": "internal"
        },
        {
          "label": "costs and fees",
          "url": "https://thetraderwiki.com/en/costs-and-fees/#financing-formula",
          "type": "internal"
        },
        {
          "label": "forex trading",
          "url": "https://thetraderwiki.com/en/forex-trading/#sessions",
          "type": "internal"
        }
      ]
    },
    {
      "type": "list",
      "id": "practice-plan",
      "heading": "A practice plan with a fixed end",
      "url": "https://thetraderwiki.com/en/demo-accounts/#practice-plan",
      "intro": [
        "A practice plan gives your demo both a clear purpose and a fixed end. Left as it is, a provider’s demo has neither."
      ],
      "ordered": true,
      "items": [
        "Write your rules first: what you trade, at what hours, on what signal, with what stop, at what size, and what ends your day.",
        "Fix the number of trades in advance. Make the number big enough to tell a working rule from luck. Don’t add trades because the results are bad or good (trading strategies).",
        "Follow the rules exactly, including the losing trades they produce, and mark every time you break a rule in the record.",
        "Once the plan ends, tally how often you broke the rules before you look at the profit. A demo that made money with many broken rules has tested nothing.",
        "From the record, work out your expectancy after costs. Expectancy is the average amount you won or lost per trade. Then compare it with what a real account would add: slippage, wider spreads, and the financing the demo didn’t charge."
      ],
      "links": [
        {
          "label": "trading strategies",
          "url": "https://thetraderwiki.com/en/trading-strategies/#expectancy",
          "type": "internal"
        },
        {
          "label": "expectancy",
          "url": "https://thetraderwiki.com/en/glossary/#expectancy",
          "type": "internal"
        }
      ]
    },
    {
      "type": "prose",
      "id": "when-to-stop",
      "heading": "When to stop practising",
      "url": "https://thetraderwiki.com/en/demo-accounts/#when-to-stop",
      "paragraphs": [
        "Stop practising when your record says you’re ready, whatever the balance says. You’re ready once the record shows you kept to your written rules during a run of losses, without breaking them. A real account needs exactly that behaviour, and it’s the only thing a demo can show you.",
        "A profitable demo balance is no reason to stop. That profit may come from one lucky month, from a rule that happens to fit that period or from costs the demo didn’t charge. You learn more from a losing balance you got by following your rules than from a winning balance you got by ignoring them.",
        "A demo that runs forever no longer teaches you anything. Going straight from a demo to a real account with your full planned balance skips a step. That step is a real account funded with a small amount you can afford to lose (minimum deposits). The how to start trading page shows the demo as one part of the seven steps from first lesson to first trade."
      ],
      "links": [
        {
          "label": "minimum deposits",
          "url": "https://thetraderwiki.com/en/trading-account-types/#deposits-and-currency",
          "type": "internal"
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        {
          "label": "how to start trading",
          "url": "https://thetraderwiki.com/en/how-to-start-trading/#seven-steps",
          "type": "internal"
        }
      ]
    },
    {
      "type": "prose",
      "id": "why-demo-overstates",
      "heading": "Why demo results look better than live ones",
      "url": "https://thetraderwiki.com/en/demo-accounts/#why-demo-overstates",
      "paragraphs": [
        "Because of how a demo is built, its results look better than live ones. Nobody is cheating. There are four reasons, and the last is the biggest.",
        "Start with how orders are filled. On a demo, your order usually fills at the price on screen. A live order can fill at a different price, and in fast markets you pay slippage (how a trade works).",
        "Spreads widen the gap. The live spread may be wider than the demo one. You pay that wider spread on a live account at rollover and around news.",
        "Some costs may be missing from the demo too. Financing, currency conversion and any minimum commission may not appear.",
        "Behaviour makes the biggest difference. With nothing at stake, you leave a stop where you put it and take a loss as planned. The habits that empty real accounts don’t appear: averaging down, revenge trading and moving stops (risk management). Averaging down means adding to a losing trade. Revenge trading means jumping into new trades to win back a loss.",
        "Styles that trade often see the widest gap between demo and live. You pay a cost on every trade for each of the first three reasons, so more trades make that gap bigger."
      ],
      "links": [
        {
          "label": "how a trade works",
          "url": "https://thetraderwiki.com/en/how-cfd-trading-works/#execution-and-slippage",
          "type": "internal"
        },
        {
          "label": "risk management",
          "url": "https://thetraderwiki.com/en/risk-management/#failure-modes",
          "type": "internal"
        }
      ]
    },
    {
      "type": "callout",
      "id": "demo-warning",
      "heading": "A demo can’t show you how a real loss feels, and that’s what matters",
      "url": "https://thetraderwiki.com/en/demo-accounts/#demo-warning",
      "variant": "warning",
      "label": "Risk warning",
      "paragraphs": [
        "A demo can’t show you how a real loss feels, and that’s the part that matters. Regulators’ loss figures tell you about real accounts. The habits behind those losses only appear when you’re trading with real money. National regulators found that between 74 % and 89 % of retail accounts lost money, according to a 2018 report from ESMA (press release, 27 March 2018). A profitable demo gives you no evidence your real account will make a profit."
      ],
      "links": [
        {
          "label": "ESMA",
          "url": "https://www.esma.europa.eu/",
          "type": "source",
          "title": "European Securities and Markets Authority",
          "publisher": "ESMA"
        },
        {
          "label": "press release, 27 March 2018",
          "url": "https://www.esma.europa.eu/press-news/esma-news/esma-agrees-prohibit-binary-options-and-restrict-cfds-protect-retail-investors",
          "type": "source",
          "title": "ESMA agrees to prohibit binary options and restrict CFDs to protect retail investors",
          "publisher": "ESMA"
        }
      ]
    },
    {
      "type": "faq",
      "id": "demo-questions",
      "heading": "Questions about demo trading accounts",
      "url": "https://thetraderwiki.com/en/demo-accounts/#demo-questions",
      "intro": [
        "Questions about demo trading accounts mostly focus on what a demo is, how closely it matches live trading and how long to practise."
      ],
      "items": [
        {
          "id": "what-is-a-demo-trading-account",
          "question": "What is a demo trading account?",
          "url": "https://thetraderwiki.com/en/demo-accounts/#what-is-a-demo-trading-account",
          "answer": [
            "A demo trading account copies a provider’s platform and uses pretend money. It shows live or slightly delayed prices. Its order types match those on a real account. You can learn the platform on it at no cost. Nothing you win or lose on it is real."
          ]
        },
        {
          "id": "what-is-a-forex-demo-account",
          "question": "What is a forex demo account?",
          "url": "https://thetraderwiki.com/en/demo-accounts/#what-is-a-forex-demo-account",
          "answer": [
            "A forex demo account is a demo trading account for practising on currency pairs. It behaves like any other demo, and most of them include indices, commodities and shares too. You’ll find it listed with the provider’s live accounts on the account types page."
          ]
        },
        {
          "id": "demo-vs-live-account",
          "question": "What is the difference between a demo account and a live account?",
          "url": "https://thetraderwiki.com/en/demo-accounts/#demo-vs-live-account",
          "answer": [
            "A demo account differs from a live account in how orders are filled, what costs are charged and how you behave. A demo usually fills your order at the price on screen. The demo may leave out financing costs, and nothing is at stake. So demo results look better than live ones."
          ]
        },
        {
          "id": "how-to-open-a-demo-account",
          "question": "How do you open a demo account?",
          "url": "https://thetraderwiki.com/en/demo-accounts/#how-to-open-a-demo-account",
          "answer": [
            "A demo account is opened on a provider’s website or inside the platform itself. MetaTrader 4 offers to open one the first time you start it (MetaTrader). Then set the balance to the amount you’d really deposit, because the default is usually much larger."
          ]
        },
        {
          "id": "how-long-to-use-a-demo",
          "question": "How long do you need to practise on a demo account?",
          "url": "https://thetraderwiki.com/en/demo-accounts/#how-long-to-use-a-demo",
          "answer": [
            "No fixed time on a demo account suits everyone. A useful test uses a fixed number of trades under written rules and keeps a record of each trade. The practice plan sets that out, and how to start trading shows the steps that come before and after the demo."
          ]
        }
      ],
      "links": [
        {
          "label": "account types",
          "url": "https://thetraderwiki.com/en/trading-account-types/",
          "type": "internal"
        },
        {
          "label": "look better",
          "url": "https://thetraderwiki.com/en/demo-accounts/#why-demo-overstates",
          "type": "internal"
        },
        {
          "label": "MetaTrader",
          "url": "https://thetraderwiki.com/en/metatrader-4-and-5/#demo-and-passwords",
          "type": "internal"
        },
        {
          "label": "practice plan",
          "url": "https://thetraderwiki.com/en/demo-accounts/#practice-plan",
          "type": "internal"
        },
        {
          "label": "how to start trading",
          "url": "https://thetraderwiki.com/en/how-to-start-trading/",
          "type": "internal"
        }
      ]
    },
    {
      "type": "sources",
      "id": "sources",
      "heading": "Sources",
      "url": "https://thetraderwiki.com/en/demo-accounts/#sources",
      "intro": [
        "The original documents this page cites, in the order they first appear."
      ],
      "items": [
        {
          "key": "esma",
          "title": "European Securities and Markets Authority",
          "publisher": "ESMA",
          "url": "https://www.esma.europa.eu/"
        },
        {
          "key": "esma-2018-press",
          "title": "ESMA agrees to prohibit binary options and restrict CFDs to protect retail investors",
          "publisher": "ESMA",
          "date": "2018-03-27",
          "url": "https://www.esma.europa.eu/press-news/esma-news/esma-agrees-prohibit-binary-options-and-restrict-cfds-protect-retail-investors"
        }
      ]
    }
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      "title": "How to start trading: forex and CFDs for beginners",
      "url": "https://thetraderwiki.com/en/how-to-start-trading/",
      "blurb": "A beginner’s path in seven steps: the product, the costs, a demo, risk rules, a licensed provider, a record."
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    {
      "title": "Trading account types: standard, raw, Islamic, demo",
      "url": "https://thetraderwiki.com/en/trading-account-types/",
      "blurb": "Standard, raw spread, swap-free, demo and professional accounts, and what each one really changes."
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    {
      "title": "Trading platforms and trading apps: MT4, MT5, cTrader",
      "url": "https://thetraderwiki.com/en/trading-platforms/",
      "blurb": "What differs between MT4, MT5, cTrader, TradingView and providers’ own platforms, and what to check first."
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    {
      "title": "Risk management in trading: position size and stops",
      "url": "https://thetraderwiki.com/en/risk-management/",
      "blurb": "Risk per trade, sizing from your stop, the recovery table, stop types and the habits that empty accounts."
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    {
      "title": "Trading strategies: what each needs and how it fails",
      "url": "https://thetraderwiki.com/en/trading-strategies/",
      "blurb": "Trend following, mean reversion, breakout, carry and hedging: what each needs, how each fails, and expectancy."
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        "title": "Risk management in trading: position size and stops",
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