A real trading account and a demo account serve different purposes in forex and stock trading. A demo account is designed for practice. It allows traders to use virtual funds provided by the broker to test strategies, learn how platforms work, and gain confidence without risking actual money. Since no real capital is involved, the trades in a demo account carry no financial consequences. This is useful for beginners and even experienced traders who want to test new systems.

A real account, on the other hand, involves actual money. Deposits and withdrawals are made with real funds, and profits or losses directly impact the trader’s finances. Trading psychology is the biggest difference here. In a demo account, emotions such as fear and greed are absent because there is nothing at stake. However, in a real account, these emotions strongly influence decision-making, often leading to different results than what a trader might achieve in demo practice.

Execution may also vary. Some brokers provide slightly different spreads, slippage, or speed of order execution between demo and live environments. Additionally, real accounts require proper verification and compliance with regulations, while demo accounts usually need only basic registration.

In summary, a demo account builds skill and experience, while a real account tests discipline, emotional control, and risk management under actual market conditions.