If you’re a forex trader, chances are that you’ve already heard about MetaTrader 4 (MT4) and MetaTrader 5 (MT5). These are the two most popular trading platforms on the market and are among the most common platforms offered by online brokers, especially with MT4. Do know that there are other trading platforms out there, but today we will focus on these two major options. Here’s what the platforms have in common:
-Both MT4 and MT5 can be accessed for free through your forex broker. Other platforms might ask for a lifetime licensing fee, which could force you to pay around $499 out of pocket.
-Both platforms were created by the Russian development company MetaQuotes Software Corporation, which is a leader in the financial market.
-Each platform offers a user-friendly interface that is easily navigable. Video tutorials for both platforms can be found online.
-Both platforms are compatible with Windows, Mac, iPhone/iPad, and Android devices.
MetaTrader 4 (MT4)
MT4 was created in 2005 and specifically built for forex traders. Compared to MT5, the older version might seem simpler, but it is probably the best option for anyone that simply wants to trade forex and it is a simpler choice for beginners. Here are some of its (best) features:
- 9 timeframes
- Four types of pending orders: buy stop, buy limit, sell limit, sell stop
- Allows hedging
- 30 built-in indicators
- 3 order execution types
- 31 graphical objects
- Single-threaded strategy tester
- Easy to use
- Very Accessible (supports PC, Mac, Browser, iPhone/iPad, and Android devices)
MetaTrader 5 (MT5)
Five years after MT4 was created, MT5 was released. Contrary to popular belief, MT5 is not a newer upgraded version of MT4, instead, it was created to provide traders access to stocks, CFDs, and futures because MT4 was designed for trading forex. The programming language for MT5 is more complex and allows traders to perform more actions while offering more timeframes, pending order types, built-in tools, and so on. Here are some of MT5’s most notable features:
- 21 timeframes
- Six types of pending orders
- Allows hedging and netting
- 38 technical indicators
- Economic calendar
- 4 order execution types
- Supports several transaction types
- 44 graphical objects
- Multi-threaded strategy tester
- Fund transfer between accounts
- Embedded MQL5 community chat
- Very Accessible (supports PC, Mac, Browser, iPhone/iPad, and Android devices)
In addition to offering 2 more pending orders, order execution types, and other options, MT5 also comes with more built-in convenience options, including the ability to transfer funds between accounts through the platform and the embedded community char feature. These things aren’t necessary, but they do make trading more convenient.
The Bottom Line
Comparing MT4 and MT5 is a little more complex than comparing apples and oranges. Both platforms are user-friendly and designed for simple navigation, however, MT4 is more simplistic, making it a better option for beginners or those that don’t need MT5’s features. MT4 was created for forex trading, while MT5 was created to offer access to stocks, CFDs, and futures. MT5 also offers 12 more timeframes, 2 more pending order types, netting, one extra order execution type, more graphical objects, and a multi-threaded strategy tester. Still, many traders prefer MT4 because they may not need these extra features. In the end, it comes down to personal preference. Some traders are dead set on one platform or the other, while others are happy with either. If you’re unsure, consider testing out a demo account on both MT4 and MT5 to see which platform is best suited for your needs.
