MT4 vs MT5: Which Trading Platform is Best for You?
10 MIN READ
Team BitDelta Pro • 12 Aug 2024
ComparisonMetaTraderMT4 vs MT5
10 MIN READTeam BitDelta Pro • 12 Aug 2024
MT4 and MT5 are two versions of an electronic trading platform launched in 2005 and 2010 respectively. In this blog, we will help you decide which one is better for you.
Key Takeaways
MT4 is an all-in-one platform for forex trading, becoming a favourite of the trading community over the years.
MT5 is a newer version of MT4 that offers access to nearly all the financial markets, including forex and stocks.
A product of the MetaQuotes Software Corporation, MetaTrader or MT is a world-renowned electronic trading platform that grants traders access to foreign exchanges and forex markets. MetaTrader offers a premium trading infrastructure for brokers and traders alike who can take advantage of its several features such as an advanced charting package, market analysis algorithms, and multiple indicator systems.
MetaTrader has equipped the trading industry with just the right instruments to conduct its business quickly and efficiently. In 2005, MetaQuotes launched MetaTrader 4 or MT4 with much fanfare as an all-in-one platform for forex trading, quickly becoming a favourite of the trading community. In 2010, MetaQuotes launched MetaTrader 5 or MT5 as a new version of MT4, with additional asset segments and new features.
In this blog, we will compare MT4 and MT5 on different parameters so that you can assess which platform is the most convenient for you.
History of MetaTrader Platforms
Established in 2000, MetaQuotes Software Co. is one of the leading developers of software applications for brokerages, banking institutions, and trading exchanges. Its first product was FX Charts, a reliable and functional trading platform for the forex market in the early 2000s. Its second product was MetaQuotes, which provided the opportunity to develop trading applications using the MQL programming language (MetaQuotes Language). The popularity of these products established MetaQuotes as a prominent player in the finance software industry.
MetaQuotes CEO Renat Fatkhullin introduced the MetaTrader 4 or MT4 trading platform in 2005. This new generation product enveloped a distributed architecture, mobile trading options, and exceptional functionality. Due to these features, it quickly became an industry standard. Today, MT4 is used and well-appreciated by hundreds of brokers and millions of traders from around the world. 2010 saw the release of a newer version, MT5, which allows access to almost all financial markets, including forex, stock, and futures markets. The new version has several additional features that make it a seemingly more lucrative choice for the industry.
Was a New Version Truly Needed?
As MT5 was launched as a successor to MT4, we must understand their distinct features to understand why a new version was needed. Both MT4 and MT5 are electronic trading platforms with strikingly similar interfaces.
However, MT5 is meant to address the requirements of non-forex users as well, i.e., brokers and traders who want to traverse beyond forex markets and venture into stock and futures markets. In addition, MT5 introduced two more types of trading orders and 12 additional timeframes on the platform.
Approximately, only 250 assets are available for trading on MT4, whereas MT5 users can access up to 1,000 assets. Therefore, MetaTrader 4 is a groundbreaking trading platform that remains the preferred choice for the forex markets – but a new platform for broader market requirements was still needed. This is where MT5 intervened.
Key Differences Between MT4 and MT5
Feature
MetaTrader 4 (MT4)
MetaTrader 5 (MT5)
Year of Release
2005
2010
Primary Focus
Forex trading
Multi-asset trading
User Interface
Simple and user-friendly
More advanced and feature-rich
Timeframes
9
21
Order Types
4 pending order types
6 pending order types
Depth of Market (DOM)
No
Yes
Supported Asset Classes
Primarily forex
Forex, stocks, commodities, indices
Automated Trading
Yes (via Expert Advisors)
Yes (via Expert Advisors)
Backtesting
Single-threaded
Multi-threaded, faster backtesting
Custom Indicators
Yes
Yes
Economic Calendar
No
Yes
Broker Support
Almost universally supported
Growing, but not as widespread as MT4
Market Coverage
MT4 is entirely focused on the forex market where the global sale and purchase of currencies takes place. In terms of trading volume, the forex market is the largest in the world. MT5 supports trading across multiple asset classes, including forex, stocks, equities, commodities, indices, and exchange-traded funds (ETFs).
Types of Trading Orders
MT4 offers these orders: market order, buy stop order, buy limit order, sell stop order, sell limit Order, stop-loss order, and take-profit order. These orders are sufficient for most traders.
However, MT5 offers two additional types of orders: buy stop-limit orders and sell stop-limit orders. These advanced types of orders help a trader execute more strategic entry and exit points in the market.
Timeframes
MT4 offers nine timeframes: minute (M1, M5, M15, M30), hourly (H1, H4), daily (D1), weekly (W1), and monthly (MN). In contrast, MT5 offers 21 timeframes: minute (M1, M2, M3, M4, M5, M6, M10, M12, M15, M20, M30), hourly (H1, H2, H3, H4, H6, H8, H12), daily (D1), weekly (W1), and monthly (MN). A trader who is looking for a deeper chart analysis of different assets could certainly make use of the additional timeframes offered by MT5.
Technical Indicators and Charting Tools
MT4 offers 30 built-in technical indicators and 31 charting tools, which are more than enough for most traders. MT5, however, offers 38 technical and 39 graphical indicators for a deeper analysis of the market trends. In addition, it offers 44 charting tools for an advanced market analysis. Traders can also make use of several custom indicators and tools, free or paid, for an advanced analysis.
Programming Language
MT4 is built on the MetaQuotes Language 4 (MQL4) programming language which only supports single-thread operation. Consequently, complex tasks such as backtesting take much longer. MT5 is built on the MQL5 programming language which can manage multi-threading and asynchronous operations. It is crucial for quickly executing complex operations when performing backtesting or algorithmic trading via the use of experts and custom tools.
MQL5 also incorporates some distinct elements of the C++ language. It allows developers to build more advanced expert advisors (EAs) or trading robots. MT5’s MQL5 is a more advanced and object-oriented language as compared to MT4’s MQL4.
Backtesting and Optimisation
A strategy tester is a tool that allows traders to simulate a trading scenario, access the practicality of trading strategies, and optimise them for the best results when executed in live markets.
MT4’s strategy tester supports single-threaded backtests and optimises trading bots. It means you can run a backtest on a single financial instrument at a time.
MT5’s strategy tester supports multi-threaded backtests with an advanced optimisation of trading bots. It means you can run a backtest on multiple financial instruments at a time.
You can even save the results of the backtests as HTML files, which can later be viewed as Microsoft Excel files.
Hedging and Netting
On MT4, you can easily hedge your trades for risk management. Hedging involves simply executing a trade with the sole purpose of managing the risk of a potential downward price movement of another asset you already hold. MT5 permits both hedging and netting. Being a risk-management strategy, netting involves opening a trade in the opposite trend to the one of an already existing position.
Depth of Market (DOM)
Depth of Market (DOM) is a MetaTrader tool that displays bids and asks for a particular instrument at the best real-time prices (closest to the market). MT4 has a basic DOM that is sufficient for most traders. MT5 offers an advanced DOM so that you have a better understanding of the demand and supply trends of an asset.
Economic Calendar
MT5 has a built-in economic calendar that provides relevant real-time updates about the market. With this calendar, traders can keep track of the latest market announcements. It is a useful tool that assists traders in making well-informed and strategic trading decisions. Even if MT4 doesn’t offer a built-in economic calendar, users can follow a third-party calendar to keep up with the latest market news and financial updates.
Platform Usability
While MT4 is a 32-bit trading platform, MT5 is a 64-bit trading platform. MT4, with a customisable user interface (UI), is a simple and user-friendly platform for forex traders. MT5 has a similar UI but comes with additional timeframes, technical indicators, and charting tools. These features make MT5 a more sophisticated platform well-suited for traders with more technical knowledge, who want to trade across different markets.
Compatibility and Accessibility
MT4 and MT5 platforms can be accessed on both computers and smartphone devices. You can access them on Windows, macOS, and Terminal. The mobile applications are available on Android, iOS, and Huawei smartphones where all kinds of orders can be placed. Both platforms are compatible with Google Chrome, Apple Safari, Mozilla Firefox, Microsoft Edge, Opera, and Internet Explorer browsers.
Who Should Use MT4?
The ideal user of the MT4 trading platform is a retail trader who wants to realise maximum gains in the forex market. How to use MT4 depends on your expectations and aspirations from the forex market. The simplicity, ease of use, and stability of MT4, along with its extensive community support, make it an excellent trading platform for both beginner and experienced traders.
You can even use hedging for risk management while trading on MT4. It is no surprise that MT4 has been the preferred choice of the trading community for nearly two decades now; it boasts a user base of millions of retail traders and over 1,200 brokers.
Who Should Use MT5?
The ideal user of the MT5 trading platform is a future-ready trader who wants to gain wide exposure across multiple markets. If you are interested in trading a wider range of assets such as commodities, stocks, forex, indices, and more, MT5 is the better option for you. How to use MT5 depends on your trading skills and investment goals.
MT5 offers multi-threaded backtests. The advanced indicators, tools, DOP, and timeframes allow for a deeper analysis to gauge price predictions of multiple assets more precisely. Like other traders on MT5, you can use risk-management strategies like hedging and netting to maximise your returns on investments.
Transitioning from MT4 to MT5
Now that you know both the benefits and limitations of MT4 and MT5, let’s assess if you should transition from the former to the latter. If you are a retail trader who has just begun trading in the forex market, we suggest you stick to the MT4 trading platform. However, if you want to gain exposure to multiple assets from across markets, you can switch from MT4 to MT5.
The transition from MT4 to MT5 is simple.
All you need to do is install the new software on your computer or download the mobile application.
Next, you transfer all your trading account data to the new account to begin trading.
However, after installing the new MT5 software, you might encounter issues related to user interface, functionality, or new features. We recommend that you install the software under the guidance of your broker who is thorough with the latest tools. Your broker might even provide you with a few resources such as tutorials, videos, user manuals, or dedicated customer support. These resources can help you overcome challenges while transitioning from MT4 to MT5.
Once the transition is made, you must familiarise yourself with additional features and alter your strategies. Learn to take advantage of the new tools for a deeper market analysis. Copy trading is also a useful strategy to learn for a new trader on MT5. For the best returns across assets from different markets, the MetaTrader 5 is a good trading platform. If you implement the right strategies with the help of the provided tools on MT5, success is not far away. However, it takes a lot of time and effort to master MT5. So, better start right now.
How to Get Started with MT5?
Download the MT5 application from the BitDelta Pro website and install it on your computer.
Log in with your BitDelta Pro account or create a new account to get started.
Execute trades, analyse markets, and manage your portfolio with ease.
Bottom Line
MT5 is a newer version of MT4. This might imply that the latter is an upgraded version of the former, but that’s not entirely true.
It’s a fact that MT5 offers access to a wider set of assets such as forex, stocks, equities, commodities, indices, and ETFs. MT4, on the other hand, primarily deals with the forex market.
MT5 has additional timeframes, technical indicators, and charting tools. It also offers two more types of trading orders for a more strategic execution of trades.
MT5 offers new features such as an Economic Calendar.
While MT4 supports only hedging, MT5 offers both hedging and netting.
These features might tempt you to choose MT5 over MT4 for its more sophisticated technology. If you are looking for exposure to a wider set of assets such as forex, stocks, indices, ETFs, etc., MT5 should be your go-to option. With its advanced features, MT5 is a perfect trading platform for experienced traders who want to gain exposure to different markets. On BitDelta Pro, you can unleash the power of trading with MT5.
FAQs
MT4 is a trading platform introduced by MetaQuotes Software Corporation in 2005. It is an all-in-one forex trading platform, one of the best in the world.
MT5 is a trading platform introduced by MetaQuotes Software Corporation in 2010. It lets traders access a broader set of financial markets such as forex, stocks, equities, commodities, indices, and ETFs.
While both MT4 and MT5 are trading exchanges offered by MetaQuotes Software Corporation, they have significant differences:
MT4 primarily caters to the participants of the forex market. MT5 caters to participants of nearly all markets such as forex, stocks, equities, commodities, indices, ETFs, etc.
MT4 offers only four types of trading orders, while MT5 provides six.
MT4 offers nine timeframes, 30 built-in technical indicators, and 31 charting tools. In contrast, MT5 offers 21 timeframes, 38 built-in technical indicators, 39 graphical indicators, and 44 charting tools.
MT4 offers only hedging, while MT5 offers both hedging and netting.
In comparison, MT5 is a more sophisticated trading platform than MT4, as it offers new and additional features. While MT4 is only a forex trading platform, MT5 is a trading platform for nearly all the global markets.
If you are starting your investment journey as a forex trader, MT4 is your ideal option. If you are an experienced trader who wants to gain exposure to different financial markets and get a deeper analysis of the trends, you should transition from MT4 to MT5.
Both platforms support automated trading with EAs, though MT5 allows more complex strategies and faster testing.
Yes, both are available on iOS, Android, and Huawei mobile devices and offer essential trading features.
DISCLAIMER
This communication is for informational and educational purposes only and should not be construed as financial, investment, or legal advice. BitDelta Pro does not guarantee the accuracy, completeness, or timeliness of the information provided. Trading in traditional securities (such as forex currency pairs, stocks, bonds, and commodities) carries inherent risks, including potential loss of principal. Users are encouraged to carefully evaluate their financial objectives, conduct their own research, and seek independent financial advice before making any trading decisions. BitDelta Pro is not liable for any losses or damages resulting from actions taken in response to this communication.
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