MT4 vs MT5 – What are the differences?
MT4 and MT5 are the two most commonly used trading platforms in the forex market. Produced by Cyprus-based MetaQuotes Software Corporation, the tool comes with unique features, designed to address the needs of different traders and trading styles.
Both trading platforms boast of incredibly fast execution speeds in the capital markets. Likewise, they offer several ideal tools for technical analysis and for supplementing various trading strategies. Amidst the similarities, several comparisons set the two apart.
Understanding MT4 and MT5
Most Forex brokers offer MT4 by being the first, launched in 2005. MT5, on the other hand, came into being in 2010 with the integration of new features aimed at different markets. While MT4 sets the industry standard for forex and CFD trading, MT5 is ideal for trading, different markets, beyond forex, such as commodities options, stocks and futures markets.
The two trading platforms also differ in the programming language used and the array of pending orders available. While one platform offers technical support, the other one does not. Similarly, one of the platforms' comes with an economic calendar, while the other does not.
Differences Between MT4 and MT5 Forex Trading Platforms
|MetaTrader 4||MetaTrader 5|
|Ideal for the forex market||Ideal for multiple markets, stocks forex options e.t.c|
|Ideal for novice and beginner traders||Ideal for advanced traders given added trading features|
|Uses MQL4 language||Uses MQL5 language|
|Supports single backtesting||Supports fast and multiple backtesting|
|Does not offer technical support||Comes with technical support|
|Supports various trading strategies i.e., Hedging||Aggregates trading thus not good for hedging|
|Supports traditional time frames charts, daily and weekly charts||Supports more than twice as many time frames|
|Supports 4 pending orders||Supports 6 pending orders|
|No economic calendar||Economic calendar included|
Table 1: MT4 & MT5 Comparison
MT4 stands out as a user-friendly trading platform for beginners or novice traders trying to find their way into the trading business. A straightforward interface makes it easy for beginners to trade with ease and efficiently without the need for advanced trading skills. As one becomes experienced, the MT4 platform's customization is very much possible to meet a given trading style or need.
MT5 being an updated version of the MT4 trading platform, is well suited for advanced traders given the additional features it comes with. Its outlook outshines MT4’s, which could pose some challenges to beginners. Some of the additional features it comes with include economic calendar and social and copy trading features.
MT4 and MT5 also differ on the trading tools on offer for carrying out technical analysis. Amidst the differences, both are known for fantastic charting capabilities. Some of the popular trading tools that traders can expect include Relative Strength Index, Stochastic, and Bollinger Bands.
MT4 offers 30 indicators, 2000 + free custom indicators, and 31 graphical objects. It also provides additional paid indicators. Also, it provides 9 time-frames for trading.
MT5, on the other hand, comes with 38 in-built technical indicators and 44 graphical objects. It also features 21 different time frames to base a trading strategy, including two, eight and 12-hour charts, from what many traders are used to.
With MT4, traders can leverage various order types in trading, including buy stop, buy limit, sell limit, and sell stop. MT5, on the other hand, comes with buy stop limit and sell stop limit in addition to the four on MT4.
Traders would be more comfortable using MT4, given that each order is shown separately even while working on multiple orders. However, that is not the case with MT5 as orders are aggregated while dealing with the same asset's multiple orders.
The two trading platforms use different programming languages that support various trading features. MT4 comes with the MQL4 programming language, while the MT5 platform comes with MQL5.
While, initially, MQL5 was the only framework that supported trading robots and expert advisors, for automated trading, the features are now available on MQL4.
Exposure to Markets
MT4 came out as a trading platform for providing exposure to the forex market alone. As forex brokers expanded their offerings, the platform had to expand, thus allowing traders to access various financial instruments.
MT5 was developed to offer support to all the major markets, including stock futures, options, and forex trading instruments. MT5 supports unlimited trading symbols compared to 1024 for MT4.
Why MT4 Is an Ideal Trading Platform
MT4 stands out as an ideal trading platform for the novice, and experienced traders are given that it is straightforward and easy to use. For this reason, it is the most widely used platform globally as an obvious choice for traders.
MT4 is a mobile platform that enables trading beyond desktops. Likewise, it makes it possible to trade while on the move via smartphones and tablets. The trading platform is available in three different formats of desktop mobile and browser. The three-tier support ensures traders are independent of time and place when it comes to trading.
Just like MT5, MT4 also takes automated trading to another level. The platform offers different trading and analytical technologies for enhanced algorithmic trading. Its in-built, MQL4 IDE enables the creation of personal advisors or forex robots.
When it comes to security, MT4 adheres to the best industry standards with all information between traders and the terminal encrypted using 128-bit keys. The platform also comes with an enhanced security system based on the asymmetric encryption algorithm.
In contrast to MT5, MT4 allows almost all kinds of trading. Hedging is very much possible on the trading platform. With MT5, hedging is not possible as the platform is based on the USA non-hedging rule. It means that a trader must close one trade before entering another trade on the same financial instrument.
MT4 is a straightforward and easy to use trading platform for trading the forex market. While MT5 is well suited for trading markets other than forex, MT4 supports a wide array of trading strategies, including hedging.
MT4 also stands out as it supports the management of each position separately. MT5, on its part, aggregates all positions. MT4 also works best with almost every device, given that it takes up less memory space as compared to MT5.
MetaTrader 4 is a tried and tested trading platform ideal for users who do not have to comply with U.S regulations. It is a gold standard for trading, given that it is far easy to use and manage with less glitch than other platforms.
Frequently Asked Questions (FAQs)
Can I use the MT4 account in MT5?
No. some brokers offer both MT4 and MT5 trading platform. So, it is easy to switch to whatever platform that suits your purpose and intent.
Is MT4 a Good Platform?
Yes. MT4 is one of the most popular forex trading platforms in the world today. In fact, it is the most popular. The popularity can be attributed to its development over a decade ago. And of course, it is offered by virtually all forex brokers.
Is MT4 only for forex?
While MT4 is designed to trade forex alone, MT5, on the other hand, is designed to trade forex and other assets such as stocks, futures, commodities, and indices. However, some brokers, such as ZFX, offer the trading of non-forex instruments through MT4.
Related Article: MT4 Guide for Beginners：How to trade with MT4?
Risk Warning: The above content is for reference only and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations conducted in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
ZFX (Zeal Capital Market) is an online forex & CFD broker providing more than 100 products for forex trading, commodity trading, index trading, and share CFDs trading. The minimum deposit for the account opening is only USD 50. Open a trading account and download our MT4 trading platform now!