Broker to Trading

MetaTrader 4 (MT4) is an online trading platform made by MetaQuotes Software. It is a third party platform which some Forex brokers offer to their traders. Brokers may customise this platform in different ways, for example in terms of the markets offered or platform features. MT4 is well known as a platform for automated trading. MT4 allows the trader to use or make their own online trading robots. MT4 also supports those traders who plan and execute their own trades. In fact the trader can download or make new technical indicators.

But MT4 is not the latest offering from MetaQuotes. MT4 in fact has a successor platform, called MetaTrader 5 (MT5). MT5 possesses some similarities in terms of core features with MT4. However it also offers a number of significant enhancements. A key difference between MT5 and MT4 is that MT5 has a new language for making scripts (to automate processes), robots and technical indicators called MQL5 (versus MT4's MQL4). MQL5 however is not backwards compatible with MQL4.

So is MT5 better for Forex trading than MT4 ? MT4 is a popular platform for Forex trading and has been so for many years. While MT5 is the replacement for MT4, MT4 is still offered by many brokers. What has tended to happen is that MT4 brokers have become MT4 plus MT5 brokers over the years in a relatively gradual process. So while some brokers are still MT5 only or MT4 only, in practice a MT4 vs MT5 broker comparison can be more a difference of accounts and features at the same broker offering MetaTrader.

The lack of backwards compatibility of MT5 with MT4 for MQL5 and MQL4 (the programming language used on the platform) may suggest that a trader new to MetaTrader who wants to use this platform might wish to consider MT5. MT5 features an integrated Economic Calendar, which can be an asset for all traders as it provides a convenient way to check for news which might affect different markets. Volatility around news releases is targeted by some traders, but other traders may want to know about the possible effect on their ongoing trades of these events. MT5 also has an interface which can be seen as more user friendly than MT4, though they are pretty similar in terms of UI (user interface).

MT5 has more inbuilt technical indicators than MT4, but in practice MT4 can have more than its core offering. Both platforms allow the trader to download (typically for a fee) or to build more technical indicators as well as robots in MQL. MT5 also offers more time frames, graphical objects and pending order types than MT4 and supports 64 bit multi-threaded devices.

A difference between a broker offering MT4 and MT5, or between the accounts at a broker for each platform, is that MT5 supports more markets to trade than MT4. MT4 typically has up to 300 or so markets, while MT5 can have thousands of markets. For example, depending on the broker, MT5 may offer thousands of Stocks CFDs to trade. The bulk of a larger markets offering will be Stocks, as there are many more Stocks than other markets. However how many and even if they are offered depends on the particular broker. Allied with the platform features, the trader can take a deep dive into technical analysis or try automated trading on these and other markets, though automated trading has additional risks and can be seen as a more advanced way to trade.

Behind MT4 or MT5 is a large community which offers additional features such as robots and technical indicators. One reason why some traders may prefer MQL4 is that the MT4 community has been in existence longer than MQL5's and thus offers more EAs. Traders can trade Forex on either MT4 or MT5 and make use of their analysis tools and trading automation (which can also include copy trading, depending on the broker). But MT5 is designed to be an enhancement on MT4 and is the current release of MetaTrader, so traders may wish to start with MT5 if they can.

MT5 is designed as a multi-asset platform and Forex traders may also trade other types of markets. If traders are interested in Stocks CFD trading, then MT5 may well be a more compelling choice. Forex traders may find the additional time frame and pending order types useful as well. News is a key fundamental in Forex trading, and having an inbuilt Economic Calendar may be a helpful tool in this complex, volatile market.