By Will Kenton Updated Jul 28, A demo account is a type of account offered by trading platformswhich is funded with fake money that enables a prospective customer to experiment with the trading platform and its various features, before deciding to set up a real account funded with the customers actual money.
Demo accounts are offered by a wide variety of online trading platforms, including stock trading platforms, foreign exchange trading venues, and commodities exchanges. What Is a Demo Account?
Demo accounts became widespread in the twenty-first century, along with online trading. For instance, one popular online stock trading platform is TD Ameritrade's thinkorswim.
For instance, investors may want to internet trading demo account a demo account before they start investing in futurescommodities, or currencieseven if they already have much experience investing in stocks. How a Demo Account Works Demo accounts were not particularly feasible before the widespread use of personal computers and the Internet.
Demo accounts began to be offered by online brokerages in the s, as high-speed internet was starting to be adopted by more Americans.
Demo accounts have also been adopted as a means of teaching high school students the basics of investing in the stock market. Many school districts around the country offer personal finance or economics classes that require students to maintain a demo stock account and monitor the progress of their investments over the course of the semester.
Article Sources Investopedia requires writers to use primary sources to support their work.
Every time. NerdWallet, Inc. Its articles, interactive tools and other content are provided to you for free, as self-help tools and for informational purposes only.
These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate.
You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. TD Ameritrade.