MetaTrader is the industry-leading trading platform, used by many forex brokers worldwide. You will only encounter MetaTrader 4, which is solely for forex traders, and MetaTrader 5, which has been designed as a cross-asset trading platform to include stocks and Futures alongside forex.
As the platform is so ubiquitous across trading platforms, you will not be surprised to know that it is available across any device, so whether you want to trade on your laptop whilst at the office or on your mobile or tablet while travelling, you can do so with any broker who offers MetaTrader for their trading services.
We’ll outline why MetaTrader revised its software into a multi-asset platform, as well as the key differences between the two pieces of software, so you can make the right decision for your trading strategy ahead of opening an account and getting started.
Why did they upgrade the MetaTrader software?
Firstly, not all traders would call MetaTrader 5 (MT5) an upgrade. This is because, at its heart, MT5 is a completely different product by design. In design, MetaTrader 4 (MT4) was built solely to handle forex trades, and by the start of the 2010s, many traders were looking for a platform that combined all their marketplaces into a single, uniform app with consistent reporting, tracking, and analysis tools. Thus, MT5 was born to fill this spot in the market.
Reporting and tracking are far simpler in MT4, which is why many traders consider MT5 an upgrade: with the more recent product, you can even export your data to an Excel spreadsheet and review charts directly in the app. Watching the market is another clear upgrade on MT5, as there are more details and a much easier navigation than on the predecessor.
For more experienced traders, MT5 also offered a clear upgrade in implementing trading strategy, as the strategy testing feature now offers multi-threaded and multi-currency testing, alongside an agent manager as well. In this regard, deciding whether MT5 is an upgrade on MT4 is down to the perspective of the trader and ultimately what their overall trading strategy is trying to achieve.
Any budding trader who wishes to look at multiple markets will immediately gravitate towards MT5 as the right software for their strategy, but if you only wish to focus on the forex market and only need access to simplified tools, then MT4 will more than suit your requirements.
Comparing MetaTrader 4 vs MetaTrader 5
When it comes to drawing clear comparisons between the two versions of software, it’s easiest to start at their foundation: MetaTrader 4 was released in 2005 and MetaTrader 5 was released in 2010. Given how much technology changes over short periods of time, you can understand why MetaTrader 5 is favoured by the more complex traders as the software is able to handle much more complex analytical and technical indicators, including visualisations and shapes of data.
As we have already stated, MetaTrader 4 was built to focus only on forex trading, and therefore the platform is able to hone in on offering a simple solution. This makes MT4 an easy-to-understand and use platform, which does not take too much of a learning curve. The key analytical tools are included, offering 30 technical indicators along with 9 timeframes with which to track and assess the market on your chosen trading instruments. The most commonly held view is that MT4 is the superior piece of software for anyone who wishes to focus solely on forex trading, compared with MT5.
Aside from the sheer fact that MetaTrader 5 allows you to trade stocks, futures, cryptocurrencies and forex all in the one place, you will also find that MT5 has much more powerful analytical tools. The more recent software offers up to 44 analytical objects and 38 technical indicators, with custom technical analytical tools available for free from the built-in Code Base or available for a fee from the MetaTrader Market. The analytical objects include Gann, Fibonacci and Elliott tools as well as geometric shapes, which can be applied both on price charts and in analytical windows, giving you access to the key data you need from anywhere. A built-in economic calendar is also an extremely useful tool, as it gives you immediate awareness of key upcoming factors that could influence the trading markets.
Compared to MT4, you will find 21 timeframes offered on MT5, including a 1-minute history view. As we alluded to at the start, since MT5 is a multi-asset platform, you won’t be surprised to learn that it has an expanded instrument list which counts over 1,000 assets compared to the rough average of 250 available on MT4. If you are looking to track multiple different types of trading, all in one place, then MT5 would be regarded as superior to MT4.
Despite all of these differences, at a glance, most people would find it difficult to identify which platform is which, as they are both built to the same design and layout, and at the end of the day, both platforms provide the features and functions you need to trade successfully and effectively. The speed of MetaTrader software is to its huge advantage, as the simplicity of the code leads to lightning-fast transaction speed, which means you can make your trade before the market moves.
Make the right choice for your trading needs
Now that you have all the essential information to make a wise choice, it is up to you to decide whether you have the needs for the more complex tools and wider breadth of trading instruments or not. If you intend only to trade currency pairs on the forex market, then MetaTrader 4 will be more than sufficient to meet your requirements.
However, if you are a more experienced trader who wishes to delve into data with far more analytical depth, and your strategy requires you to trade assets across multiple markets, then you should look for a broker that offers MetaTrader 5 to its customers. There are many MT5 compatible brokers now available on the market, thanks to their consistently award-winning reviews, so you will have no problem finding a broker that suits your needs, with competitive spreads on your chosen currency pairs.
