For a long period of time people are trying to figure out which MT platform is the best. Many websites and channels have tried to address the issue, but sadly, most of the time the answer was presented in a way that overwhelmed retail investors.
In this article, we will help you recognise the key difference between MT4 vs MT5 so that you can choose the one that suits your needs the most. Remember, no platform is perfect and everything has merits and demerits. At the end of the day, the whole thing boils down to your goals and preferences.
Note that there is a big misconception that all the scam brokers use MT platforms which is simply not true. Unregulated entities are always risky and regardless of which software they support, they are likely to have high conflict of interest.
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Go through the following paragraphs to learn more about these trading software.
MT4 is undoubtedly the best retail trading application ever. It has a strong community and without technical support, it has managed to not only survive but thrive. Countless custom indicators are available for it and the functionalities it brought to the table were unparalleled at the time.
MT4 was released in 2005 and one needs to be familiar with the MQL4 language to tweak the software. Backtesting aspect is also easy with the interface and apart from a few quirks like lack of economic calendar and DOM support, this one is a pretty solid trading solution.
Even today, many brokers support this software and the trend is not going away for a long time to come.
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MT5 was released back in 2010. MT4 was focused around the forex market, but as the retail investors were hungry for more and needed better and quicker access, this solution was created. Traders can dip their hands into forex, CFDs, options and much more via this portal.
The programming language needed to make the best out of this interface is MQL5 language. This one too has a strong community and guess what? The technical support is also great. As there are thousands of developers that are familiar with this software, you can hire great programmers for a reasonable price.
The depth of market indicator is also present and it offers tremendous backtesting features as well. In short, it certainly is an upgrade over the MT4 interface.
MT4 brought a lot to the table. The charts are highly customizable and people can view multiple timeframes and upto 6 charts in a single glance. Automated trading functionality was also way ahead of its time.
By using Expert Advisors, traders can automate the entire process and the whole thing is user-friendly as well. Moving on to the indicators part, the default indicators are more than enough for the average trader. However, if you want custom tools, then you can hire a developer or download the specific one you want from the internet.
At the time of making this post, there are over ten thousand indicators available. Order types give enough power to the user and it is indeed hard to find anything with this platform that can be categorized as a deal breaker.
MT5 features all the benefits mentioned above and more. The main reason behind the existence of this software is to help retail users trade CFDs and other derivative products. Charting is highly customizable and MQL5 programming brings tons of new functionalities.
For starters, the execution speed is improved by a considerable margin. Backtesting functionalities are quicker and more parameters can be visualized. 6 types of pending orders are present and the availability of built-in economic calendar is a huge plus point.
Depth of market data can also be found and for scalers and intra-day traders, this interface is going to be the best thing they could ever ask for. Automated trading functionality is also present and with the help of VPS, very little human interference will be required which is a huge advantage for people that have day jobs.
MT4 vs MT5: Which is better?
The MT4 vs MT5 debate is a heated one and people for the most part are just confused. MT5 is certainly the improved version and it offers a lot of features compared to the former which is expected.
If you are just starting out, then it doesn’t really matter which one you choose as you are most likely to dabble with small capital and find your sweet spot. On the flip side, if you trade both forex and other CFDs, then you will be happy with MT5 as it offers more functionality and cutting edge things. Just make sure to stick with regulated brokers and have a strict risk management plan in place for best results.
MT4 platform allows hedging and people can average down their entries to mitigate the losses or just make money from the swaps if the conditions are ripe. MT5 software does not allow hedging, instead it aggregates the position.
In simple words, it follows the First in, First out approach which means hedging cannot be carried out unless you have two separate accounts. FIFO is enforced in the United States and this aspect certainly has a lot to do with the platform you choose.
To be on the safer side, talk with a financial planner before beginning your trading journey.
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Which Platform do you prefer? Let us know your answer in the comment’s section.