Electronic Trading Platforms are essential in online Forex Trading. It is always a question in the trader’s mind as to which trading platform to use for Forex Trading? There is a lot of competition going on between several Forex Trading Softwares/Platforms.
MT4 Trading software is very popular and setting the industry standards throughout. Most of the Brokers offer forex trading through the MT4 trading platform. A company named MetaQuotes developed this trading platform in 2005.
Over the years, the company has added many features to MT4. Even though the same company produces the MT5, its usage is less when compared to MT4. To understand why this difference, we need to take a closer look at the features of both these platforms.
What is MetaTrader?
MetaTrader is a trading software commonly used by FOREX TRADERS on its trading platform. This software mainly automates their trading process and is used widely by foreign exchange speculative traders. It is a platform where you trade with the broker of your choice and get connected to other different trading platforms. Moreover, it also allows you to trade through Smartphones or Computers.
What is MetaTrader4?
MT4 is a forex trading platform used to trade with multiple markets including forex, indices,
cryptocurrencies, and commodities. The mobility and security features of MT4 makes it a classic choice for all regular traders. Further, MT4 also automates your trading with algorithms that open and close trades on your behalf.
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What are the Benefits of MetaTrader 4?
Here, are the benefits of using MetaTrader 4.
Firstly, people always look for security wherever money is involved. Likewise, MT4 has the highest security standards, including 128 -bit encryption key between server and trader. It means that the private account information and other data gets completely concealed to ensure no hacking. The server of MT4 also comes with the RSA digital signature.
Suitable for Developers:
MT4 platform allows developers to build their individual algorithms. With the help of SQL, the developer can design their own indicators and trading robots. Further, these features enable traders to create automated trading strategies that suit their requirements.
MetaTrader4 has users spread across different countries. The wide range of language options makes this platform smooth to use. Subsequently, traders can change the language preference of the platform at any point in time. Imagine how easy it could have been if we were able to understand charts and communicate with the platform in our mother tongue. Likewise, it would be simple to detect and understand the errors and messages that get displayed in our language.
Advanced Chart Capabilities:
Before you start trading in the forex, examine the price movement of the currency pairs. MT4 has charting tools that help traders to analyze the pricing movements.
Real-Time access to Market Prices:
It grants traders to access forex quotes in real-time and execute trades. The Market watch window contains securities and currencies which the traders choose to trade from a broker. The traders can view all details like contract size, margin percentage, and currency from this window.
The platform also has another feature called Depth of Market that tells the traders about the real-time activity. The Depth of Market also shows the number of buys and sell orders for currency pairs at different prices.
Access to Multiple Markets:
As this platform is forex related, the trader can also trade on other markets like futures, commodities, and equities. It also allows them to analyze and make a transaction on any market.
What is MetaTrader5?
Metatrader 5 is a multi-asset, fast, efficient, and secured online trading platform designed for the forex market. It offers you outstanding trading possibilities and technical analysis tools.
The platform enables the use of an automated system and copy trading. It has built-in features like Market of trading robots, Freelance database etc.
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What are the Benefits of MetaTrader5?
The MQL5 environment supports algorithmic trading. It enables you to establish and optimize robots as per your custom trading needs.
MT5 provides advanced reports that help to analyze trading activity quickly and easily. That is to say that these reports are useful to track the initial and final deposited values. It also helps to understand the indicators such as Z-score, Profit Factor, and GHPR.
Trader Friendly Platform:
Modern stockholders and traders are fortunate that they can approach online platforms and contribution firms to maintain their portfolio. Presently, MT5 is one of the most accomplished software platforms. It allows for integrating several real-time trading aspects that are designed mainly for instant access to the forex market. This helps in delivering clear insight that could help you make an informed resolution.
MT5 is designed for easy exploration and boasts as a very user-friendly and reliable interface. The platform designed with large icons and a well-formed desktop makes a significant difference. The difference is mainly because the volatile marketplace needs rapid decision marketing in real-time.
Large Analytical Toolset:
MT5 offers a wide range of analytical tools for maximum market insight. MT5 possesses the most extensive and broad suite for tools. These tools provide more than 30 unique features that include historical data and advanced analytical trends. These data and trends can be convenient for those who require a comprehensive market analysis.
Comparison of Basic Features for MT4 and M5
MT4 is a 32-bit, mono-thread platform while MT5 is a 64-bit, multi-thread platform. In other words, the multi-thread platform makes MT5 a much faster and efficient trading platform.
Timeframes help clients to analyze trading, using charts for a specific period such as 2-hour, 6-hour, 8-hour, or 12-hour. MT5 comes with 21 timeframes, whereas MT4 has only 9.
For any analytical purposes, we use Graphical objects. Such Graphic Objects are Text Label, Graphs, Bitmap, Arrows etc. MT5 provides around 44 Graphical objects, while MT4 provides only 31 Graphical objects. These tools help to mark patterns, areas, and levels on the chart.
When it comes to technical analysis, both MT4 and MT5 are highly efficient. Technical indicators forecast future pricing changes. MT5 empowers you with 38 such indicators. In comparison with MT5, MT4 offers only 30 indicators for technical analysis. You can check out these below links for more details on Technical indicators.
Both MT5 and MT4 have the feature of backtesting. But there is a slight difference in the backtesting feature in MT4 can be done only through a single pair. This makes the processing time-consuming. Incase of MT5, it comes with 3 features such as multi-thread, multi-currency and real tick feature, which make it a lot easier.
In terms of pending orders, MT4 has four different types of pending orders: Buy Limit, Buy Stop, Sell Stop, and Sell Limit.
Similarly, MT5 offers six different types: Buy Stop, Buy Limit, Buy Stop-Limit/Buy Limit, Sell Stop, Sell Limit, and Sell-Limit/Sell-Stop Limit.
MT4 comes integrated with the MQL4 programming language. MQL4 is a high-level object-oriented language. These programs support to formulate automated trading strategies, customized technical indicators for analyzing financial markets. It focuses on strengthening the trading programs based on the order system. This programming language requires multiple functions.
MT5 is based on MQL5. Traders use this to establish a positional system. Thanks to this programming language, as the traders can change and write new scripts.
Many popular brokers prefer working with MT4 than MT5. However, the situation may change in a few years, as the focus of traders shall shift to the MT5 trading platform. Make sure to check its services after installing MT4 or MT5.
Comparison of Other Key Features:
|Availability to brokers||Very popular||Very popular|
|User-friendly and easy to navigate||Extremely easy||Extremely easy|
|Roll-over and Hedging||Possible||Possible|
|Programming Language used||MQL4||MQL5|
|Number of order execution types||3||4|
|Number of Pending Order Types||4||6|
|Depth of Market||No||Yes, but not available from the beginning|
|Economic Calendar||Not Available||Available in MT5 apps|
|Reports||Tables only||Tables + Charts Everything can be exported to Excel|
|Open Trades View||Lots only||Lots, Quantity + Milliseconds|
|Docked Charts||Not available||Available|
|Market Watch||Less detailed||More details + easy navigation|
|Partial Order Filling||Not available||Available|
|Email System||No attachments||With attachments|
|Strategy Tester||Single-threaded||Multi-threaded + Multi-currency + Agent manager|
|Exchange Trading||Not supported||Not supported|
|Funds Transfer between Accounts||Not supported||Supported|
|Partial Order Filling Policies||Yes||No|
|Order Fill Policy||Fill or Kill, Immediate or cancel||Fill or Kill|
|Pending Order Types||6||4|
|Times & Sales||Yes||No|
|Transfer funds between accounts||Yes||No|
|Embedded MQL5. community chat||Yes||No|
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Which Trading Platform Should You Use?
As we see that MT5 has some extra features than MT4, but It may prove complicated for new traders. One who is relatively new to trading may find MT4 as genuine and easy to use. In such a scenario, MT4 becomes an obvious choice. Thus, MT4 has become the most preferred and widely used platform worldwide than MT5.
To sum it up, traders always want something reliable, easy to use, and a platform that does not crash often. Based on the expert and broker reviews, MetaTrader4 is an excellent choice for them.