There are major differences between the two popular trading platforms, and each is a perfect choice for its use case.
In this article, we shall compare Meta Trading 4 and Meta Trading 5, check their benefits, specific use cases, and other things you should know to choose as a trader.
What are MT4 and MT5?
MetaTrader 4 (MT4) and MetaTrader 5 (MT5) are two trading platforms developed by Meta Quotes Software that traders worldwide use to trade assets and commodities.
Meta Trader 4 is a trading platform that was launched in 2005. It was created as Windows-PC-compatible software, which provided traders with multiple possibilities. For example, a user can place orders that automatically execute once the prices reach a predefined point.
Meta Trader 4 is based on the special programming language MQL4, which was created for its development. It was designed to let the platform run complex operations while providing security.
The software consists of two components: the server and the client side. The server side provides the user interface to brokers, while the client-side brokers’ customers see live streaming prices and charts, place orders, and manage their accounts.
While effective and straightforward, the platform is limited to forex trading; therefore, the company planned to release a new version by 2010.
Meta Trader 5 was released in 2010 and announced enhancements and new features. The key difference was multi-asset trading: besides forex, users could trade stocks, CFDs, futures, and cryptocurrencies.
The new version also introduced two new features: market depth and economic calendar. The former allows running market analyses based on indicators, while the latter allows prognoses based on current market events.
Another significant difference was the change in the underlying programming language. We shall remind you that MT4 was developed on the basis of MQL4. It was completely revised for the new software, although it happened after three years of MT5’s official release. This means that the first versions of MT5 were based on the same programming language as MT4. Yet, a new programming language was developed to develop the platform further. The latest version allowed the system more functionality and speed.
MT4 vs. MT5: Feature Comparison
In terms of features, both platforms are somewhat different.
As mentioned above, MT4 is designed for forex trading only, while MT5 can support multiple assets, including cryptocurrencies.
Mt4 offers 30 built-in indicators, while the next version raises this number to 38 and includes 44 analytical objects.
MT4 supports four types of pending orders, while MT5 offers six types of pending orders.
MT4 provides a single-threaded strategy tester, and MT5 offers a multi-threaded and multi-currency strategy tester that also includes the reverse testing feature.
When judged by numbers, this comparison favors MT5 as a newer and more powerful version. Yet, MT4 remained the preferred and most used platform for ten years after MT5’s release.
Users prefer it for its simplicity and ease of use.
The platform is still used by traders worldwide. Below, we shall compare the perfect use cases for both platforms.
When To Use MT4 vs. MT5?
MT4 is loved for its simplicity. So, it is recommended to use MT4 if you prefer a simple-to-understand software interface. Besides the ease of use, the platform is fine-tuned to forex trading, and therefore, it is preferred by forex professionals.
MT5, on the other hand, offers access to multiple assets, so it is recommended to chode it if you need to trade in different assets from one place.
The newer platform also offers a higher number of indicators and better analytics, as well as faster executions of orders and other operations, thanks to the enhancements in the MQ5L language.
The important change is also automated trading. MT5 offers a higher level of automation compared to the previous version.
At the same time, both versions can boast a handy mobile app that simplifies trading on the go, automatically alerts users of important developments, and supports one-click trading.
It is also important to pay attention to your trading style. Forex-only traders benefit more from MT4’s simpler interface and massive library of existing Expert Advisors (EAs) and indicators.
At the same time, algorithmic traders who require multi-currency backtesting and high-speed optimization will benefit from MT5’s possibilities.
Long-term investors may also benefit from MT5’s built-in economic calendar and multi-asset support, which allows them to create long-term multi-asset strategies.
Summing up
The development of different tools for testing testifies that the market developers cater to traders’ various needs. Therefore, the popular platform MT4 has given a newer branch of MT5 by attracting a broader audience of traders. While both platforms offer numerous benefits, their mutual existence on the market allows traders to select the best platform for every use case.