Which Trading Platform is Right for Forex Brokers in 2021 – MT4 or MT5?

If you’re someone involved in the forex trading operations, you will need a reliable trading platform to manage potential risks and streamline your business processes. MetaTrader 4 (MT4) and MetaTrader 5 (MT5) are the two top-ranked trading platforms because of their valuable tools, best-in-class functionality, and resources.

Although many people think that MT5 is just an updated version of MT4, the reality is that both of these platforms offer different functions and features that cater to the needs of distinct trading audiences. Deciding whether to use MT4 or MT5 should be based on your background, trading goals, and other crucial factors.

Let’s see how these trading platforms differ from each other and which one is the best for you.

What is MT4?

MetaTrader 4 is a popular trading platform released in 2005 to allow forex brokers to gain a competitive advantage. It sets a new benchmark in the industry standard for a forex or CFD trading platform. The real-time action, numerous types of execution modes, high stability, and the automated trading option is the biggest power of MT4.

What is MT5?

MetaTrader 5 was launched in 2010, five years after the release of MT4 and at a phase when MT4 was already so popular. It is a common misconception that MT5 is a new improved version of MT4, but in fact, it is designed to deliver functionality and perform some things that the MT4 platform cannot. It was established for different market scenarios. 

In a broader sense, MT5 was designed to trade markets other than the forex, such as stocks and commodities in order to plug into a centralized trading exchange.

Significant Difference Between MT4 and MT5 Forex Trading Platforms

  1. MT4 platform uses a programming language called MQL4 while MT5 uses MQL5. The most fascinating aspect about MQL5 is that it enables black box programming, which is easier to program and practically be a better framework for users of expert advisors.
  2. The interface of MT4 is simple and easy to understand for forex traders. MT5 interface, on the other hand, has a similar layout, however, it includes additional timeframes, services, and benefits.
  3. MT4 has four types of pending orders i.e., buy stop, buy limit, sell limit, and sell stop. MT5 has six types of pending orders, including buy stop, buy limit, buy stop limit, sell stop, sell limit, and sell-stop limit.
  4. MT4 platform allows hedging whereas MT5 enables both hedging (by request) and netting.
  5. MT4 includes tools to analyze the market of different complexity levels, such as built-in indicators, free custom indicators, and paid indicators. MT5 offers technical analysis, including technical indicators, analytical objects, number of charts, and timeframes.
  6. MT5 offers relatively more technical indicators than MT4, alongside tools like the economic calendar that allows traders to track news from several foreign markets. 
  7. MT5 serves features like multi-threaded strategy tester, fund transfer between accounts, and integrated community chat that MT4 doesn’t provide. 

Which Trading Platform is Best for Forex Traders?

If you want to access stock and commodities exchanges that are hard to do with MT4, then MT5 is the smart move for you. However, MT4 always remains a tried and tested platform in the forex market and way more popular than MT5, and that too for some good reasons, such as easy to use and glitch-free interface.

Overall, choosing amongst these trading platforms comes down to your personal preference. If you’re new to the trading concept and just want to trade forex, MT4 is suitable for you. On the other hand, if you require a more versatile platform, along with additional features and functionality, MT5 is right for you.

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