Demo account vs Live Account
Look-alike pair
Full entries: Demo account.
A demo account and a live account differ in one decisive way: a demo account trades simulated funds, while a live account trades real funds. That single distinction drives every other difference, from risk to execution to the paperwork you sign.
Side by side
| Demo account | Live Account | |
|---|---|---|
| Funds used | Simulated funds provided by the broker; no real money is deposited or withdrawn. | Real funds you deposit; profits and losses are settled in actual money. |
| Financial risk | No financial risk; losses are simulated and do not affect your capital. | Full financial risk; losses reduce your account balance and may exceed your deposit depending on the product and jurisdiction. |
| Execution venue | Orders are typically filled on a simulated environment, not the live market. | Orders are routed to the live market or the broker's live execution venue. |
| Account opening | Usually opened instantly with minimal information; no identity verification required in many cases. | Requires identity verification, suitability checks and signed agreements; rules vary by country and regulator. |
| Field mark | The account label or platform header usually includes the word 'Demo' or 'Practice'. | The account label or platform header usually includes the word 'Live' or 'Real'. |
| Purpose | To learn the platform, test a strategy or rehearse order entry without risking money. | To trade for actual profit or loss in the real market. |
Which word to use
Use demo account when you mean a simulated, risk-free environment for practice or testing; use live account when you mean an account that trades real funds with real financial consequences.
Family: XI · Look-alikes · Index A–Z