MetaTrader 4 and 5 - What's the Difference?
The old mantra about having the right tools for the job is one that rings particularly true, in the world of online trading. No trader worth their salt will risk a foray into a trade without the right equipment – and in this case, that’s a pioneering, world-class trading platform.
Case in point: MetaTrader (MT).
MetaTrader is essentially a trader’s toolbelt, into which the functions that enable better trading will fit. The software is perhaps the leading trading platform in the game and is currently in its fifth iteration. However, many intrepid traders still use the fourth version – perhaps preferring to stick to a tried, tested, and mastered tool that’s garnered lucrative results for them already.
And why would one shift from a working platform – especially in a world as fickle and unpredictable as online trading? In this article, we’re pitting the older against the new. The battle of the MetaTrader iterations.
Because when it comes to MT4 vs MT5, both offer similar basic functions such as quote display, order entry and execution, account management, and risk management tools. However, they differ in terms of their usability, features, and market depth. Let’s delve a little deeper into each, for a more illuminating comparison.
What are MetaTrader 4 and 5?
MetaTrader 4 (MT4) and MetaTrader 5 (MT5) are both popular choices for trading platforms, but there are some significant differences between the two. MT4 is the most commonly used platform, while MT5 is more suitable for advanced traders. MT4 has been around since 2005 and offers a wide range of features including charting tools and automated trading capabilities. MT5 was released in 2010, offering users an extended range of trading facilities such as improved charting capabilities and multi-asset support.
MT4 vs MT5: The main differences
MetaTrader is a robust platform, offering traders the ability to trade forex, stocks, commodities, and indices with ease.
MT4 was the first of its kind in the world of online trading, but MT5 has come along to help online traders develop more sophisticated strategies and make more informed decisions.
Both MT4 and MT5 offer numerous benefits which include advanced charting capabilities, support for automated trading systems (EAs), wide access to markets, as well as back testing options. As such, it can be difficult to differentiate between both platforms. However, there are key differences between MT4 and MT5.
MT4 vs MT5: An overview
Most notably, MT4 was designed for forex traders while MT5 was developed with stock and futures traders in mind – although both aren’t necessarily limited to each of these pillars. MT4 also offers one-click trading while MT5 does not – instead it focuses on enhanced charting capabilities with more indicators than MT4.
In addition, MT5 has a deeper selection of order types compared to MT4 such as buy stop limit orders which allow traders to place an order at a price higher than the current market price or sell stop limit orders. This enables them to enter the market by setting an order at a price lower than the current market price. Furthermore, MT5’s hedging feature allows users to open multiple positions simultaneously whereas this isn’t possible on MT4 without using an EA or script.
The programming
Another distinct difference between both platforms is their programming language – MT4 uses MetaQuotes Language 4 (MQL 4) while MT5 uses MetaQuotes Language 5 (MQL 5). MQL 5 is considerably faster than MQL 4 as it supports multi-threading technology while MQL 4 does not – this means that scripts running on MQL 5 can execute much faster than those running on MQL 4 due to improved task management abilities.
In addition, MQL 5 also allows users to create their own indicator systems within their own script. This option is not available with MQL 4 due to it lacking object-oriented programming support.
The databases
Finally, another difference between both of these platforms includes the fact that they use different databases. While both use databases for storing data such as prices or account information, each platform stores this data in different ways. In particular, MT4 stores data in binary files whereas MT5 stores data into CSV format which makes it easier for users to process large amounts of said data within spreadsheets or other programs.
In conclusion, both platforms have their advantages and disadvantages but each one serves a specific purpose – depending on your type of trading style, you may require either one or even both. Therefore, it’s important to do your research before determining which platform best suits your needs.
How does MetaTrader 4 usability & mobility compare to MetaTrader 5?
When it comes to MT4 vs MT5, you are spoilt for choice. MT4 is the older of the two, but still has a loyal following due to its strong usability and mobility. MT5 provides more features than MT4 and is becoming increasingly popular with traders who need fast access to data and tools.
MT4 – User-friendly
MT4’s user-friendly interface makes it great for newbies who want to get started quickly in trading. Its mobile versions also allow users to trade on the go without having to switch devices or platforms. And for those looking for some customisation options, MT4 offers multiple charting packages, technical analysis indicators and trading robots.
MT5 – The next level
On the other hand, MT5 boasts powerful capabilities such as advanced order types, automated trading and market depth. This makes MT5 a great choice for experienced traders who need more flexibility when it comes to their trading strategies. MT5 also offers comprehensive back testing capabilities, making it the perfect platform for developing and testing new strategies.
Which MetaTrader is the better between 4 and 5?
MT4 and MT5 are the two most widely used trading platforms in the retail forex market. MT4 is by far the more popular of the two, with millions of traders worldwide relying on it for their daily trading activities. MT5, however, has been gaining traction in recent years due to its improved features, and advanced capabilities.
What about forex?
When comparing MT4 vs MT5, MT5 has the upper hand when it comes to the technical side of forex trading. For starters, MT5 offers 21 timeframes compared to MT4’s nine, giving traders more flexibility when allocating trade capital across different markets. MT5 also makes use of Depth of Market (DOM) – an advanced type of market analysis that provides a better overview of pricing action – while MT4 does not. Furthermore, MT5 can handle multiple orders simultaneously, whereas MT4 can only process one order at a time.
Let’s talk charting
Aside from technical analysis capabilities, MT5 also offers better charting tools than MT4. The former supports more types of charts such as Renko and Kagi diagrams which provide a clearer view into price movements. Meanwhile, MT4 only supports bar charts and candlesticks. In addition to this, MT5 boasts 38 inbuilt indicators compared to 31 from MT4 – allowing traders to evaluate potential trades based on a wide range of data points.
How about execution speed and responsiveness?
For traders who prefer placing trades manually as opposed to using automated strategies or expert advisors (EAs), then MT5 is the preferred platform given its superior order execution speed and responsiveness to price movements. This is especially useful for scalpers who rely on faster orders to take advantage of small price fluctuations before they dissipate quickly.
Overall, both platforms have their own pros and cons but when it comes down to picking one over the other, MT5 is the superior choice due to its greater technical capabilities as well as more advanced charting tools. Ultimately, MT5’s advanced status allows traders to analyse price movements more accurately and execute trades faster than ever before – making it ideal for both manual and automated trading styles alike.
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