Regardless of your experience level in the trading industry, it’d be difficult not to have heard of MetaTrader or MetaQuotes Software.
MetaQuotes Software Corp., a significant supplier of software applications for brokerages, banks, and exchanges, was formed in 2000. The company has built several well-known products, from a simple FX Charts platform to the MetaTrader 4 and MetaTrader 5 platforms (commonly known as MT4 and MT5).
Both MT4 and MT5 offer lightning-fast execution and a variety of trading tools to their users. Clients may trade on award-winning platforms, examine live streaming prices and charts, place orders, and manage their accounts with this software, which most brokers use throughout the world.
Despite this, there are a few comparisons between the two programs that are worth noting.
MT4, released on July 1, 2005, is a simple and easy-to-use electronic trading platform reserved primarily for the online retail forex market. A new trading platform called MT5, which was released five years later, on June 1, 2010, is a state of the art multi-asset platform.
Both trading platforms MetaTrader 4 (MT4) and MetaTrader 5 (MT5) are used by third-party traders. After downloading the interface to your computer, you’ll be able to connect to your chosen broker . Therefore, MT4 and MT5 are research and analysis tools and trading platforms that facilitate transactions, but they are not broker systems per se. They will instead send your orders in real-time to your selected brokerage firm.
Both MT4 and MT5 support automated trading robots. An expert advisor, also known as a forex EA (Expert Advisor), allows you to trade 100% automatically. Your chosen trading robot will enter buy-and-sell positions around the clock without you having to lift a finger to make them.
MT5, is no doubt, a superior trading platform than MT4. The new version supports trading in a wide range of markets, compared to MT4, which only supports forex and CFDs trading. In addition, the platform provides better control with the need for fewer third-party plugins and comes with an STP Gateway that allows any MT5 broker to connect directly to any other MT5 broker for liquidity.
Better control (fewer third-party plugins):
MT5 comes with ‘built-in order routing’. Brokers using MT4 would either need MetaQuotes’ own ‘Virtual Dealing Desk’ to handle this function or require third-party plugins like ‘Panda’ or ‘Ashira’ to provide the same features. The built-in order routing available in MT5 is astoundingly powerful. MT5 also offers extensive API support, allowing brokers to build custom applications, reporting tools, and even integrate MT5 with their websites. Customization and control are two very apparent themes that come to the surface with even the most cursory review of MetaTrader 5.
MetaTrader 5 becomes more popular than MetaTrader 4 among brokers:
MetaTrader 5 has become the most popular trading platform. The number of companies using MetaTrader 5 has exceeded the ones using MetaTrader 4 in June 2021. This is an expected result since the trading platform is constantly evolving, becoming even more powerful. For instance, the amount of MetaTrader 5 code has already reached 7 million lines, while the previous version had only 2 million.
Distributed architecture and 64-bit versions of platform components enable the usage of all hardware capabilities:
All MetaTrader 4 components are provided as 32-bit applications, due to which the available RAM amount is limited. The MetaTrader 5 was originally created to benefit from 64-bit opportunities provided by modern CPUs. Therefore, the platform has overcome the limitation of 10 million orders, as well as the limitations on the number of symbols and groups. Another limitation in MetaTrader 4 relates to the chart and tick history volume stored on the server side. The more symbols on the MetaTrader 4 server, the less space is left to store each symbol’s history. In MetaTrader 5, chart and tick history is only limited by the disk volume.
The most appealing aspects of MT4:
Areas where MT4 falls short:
The most appealing features of MT5:
Areas where MT5 falls short:
In conclusion, both MT4 and MT5 serve a common purpose. That is, both platforms are ideal for those who want to conduct advanced technical analysis and implement custom trading strategies. They are available as desktop software, web browsers, and mobile apps – and both provide full support for forex EAs and robots.
Having said that, MT5 is gradually dominating the market share and it can help brokers meet the current market trend (Crypto, Shares trading) since Metaquotes constantly monitor changes in the industry, and introduce new technologically advanced features.
After reading the above MT4 and MT5 comparison, the answer to this question should be pretty obvious. If you want to do a lot of backtesting using the platform offline or want access to stock and commodity exchanges that Metatrader 4 does not support, Metatrader 5 is the obvious choice for you.
In any case, Metatrader 4 is still a tried and tested the gold standard platform in the industry. It is far more popular than Metatrader 5, and for a good reason: it is simple to use and manage, with fewer bugs than its browser-based competitor platform.
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