Demo accounts: what they teach and where they lie
What you learn in 3 minutesA reader asks: why does my demo trade fill at a price I never see again on a live account? This lesson shows what a demo teaches honestly — the platform buttons and the arithmetic — and where it stops being honest, using USD/ZAR near 18.4100 and money in rand. By the end, the reader can work out what a one-pip move is worth on a given lot size, and why the price on the ticket is not always the price on the statement.
18.4100 to 18.4120 — what 20 pips costs on 0.10 lots
| Step | Amount | Note |
|---|---|---|
| Instrument and price | USD/ZAR at 18.4100 | the round-number price used throughout this lesson |
| Position size | 0.10 lots | one tenth of a standard lot; the size the reader chooses |
| Pip size on USD/ZAR | 0.0001 | the fourth decimal place, the usual pip for this pair |
| Value of one pip on 0.10 lots | R1.00 | 0.0001 × 10,000 units = 1 unit of the quote currency, the rand |
| Move in the example | 20 pips | from 18.4100 to 18.4120 |
| Result on the position | R20.00 | 20 pips × R1.00 per pip |
| Demo fill | 18.4100 | the demo fills at the price on the ticket |
| Live fill after slippage | 18.4120 | the market moved 20 pips before the order filled |
| Difference in rand | R20.00 | the same 20 pips, now a cost rather than a gain |
A broker may quote a slightly different pip value, round the fill to its own precision, or add a spread and commission on top. These vary between brokers, so the rand figures here are only the arithmetic from the numbers given.
The mistake people make here
The common mistake is to treat a demo fill as proof of what a live fill will be. In a fast market the price can move between the click and the fill, so the live price is worse than the demo price. Some brokers then send a requote — a new price to accept or reject — which a demo rarely shows. The fix is to practise on a demo for the platform and the sums, then move to a live account with the smallest size the broker allows, so the first real slippage costs a few rand rather than a large amount. Treat the demo as a calculator, not as a rehearsal of the market.Check yourself
USD/ZAR is at 18.4100. On 0.10 lots, one pip is worth R1.00. If the price moves 15 pips in your favour, what is the result in rand?
15 pips × R1.00 = R15.00.
The same 0.10 lots fill 12 pips away from the price on the ticket. What is the difference in rand?
12 pips × R1.00 = R12.00. That is the slippage cost on this size.
A demo shows a fill at 18.4100. A live account fills at 18.4120 on 0.10 lots. How many pips and how many rand separate them?
18.4120 − 18.4100 = 0.0020, which is 20 pips. 20 pips × R1.00 = R20.00.