Choosing which platform to use can be quite hard for beginner traders. There are so many of them! MT4, MT5, cTrader, NinjaTrader, and some brokers even offer custom-made trading platforms.
Some of the best-known trading platforms in the market are MetaTrader 4 and MetaTrader 5, and although they are created by the same company, there are a bunch of differences between these two.
Deciding which one to use requires traders to truly understand their individual wants and needs in the trading market. Like any other decision, you will have to make when trading Forex, choosing the right trading platform also requires a lot of research and a good understanding of the market.
To help you out with your first steps, we have created a comprehensive guide to the differences between MT4 and MT5. So, follow our guide and find out which trading platform is a better fit for your trading endeavors.
5 Things You Should Know About MT5 vs MT4
MetaTrader 4 and MetaTrader 5 were created by the same company, MetaQuotes
MetaTrader 4 was created specifically for Forex trading, while MetaTrader 5 offers traders access to many other trading markets
MetaTrader 4 uses the MQL4 coding language while MetaTrader 5 uses MQL5
Both trading platforms offer trades access to Expert Advisors, which are automated trading tools to help traders identify the best trading conditions
Contrary to popular belief, MT5 is not an update of MT4, it is a trading platform of its own
Main Differences Between MT4 to MT5
Although these trading platforms were created by the same company, they are still very different from one another. The differences include everything from the availability of the trading assets, to different types of charts and time frames offered by the platforms, as well as types of orders.
Below, we have listed and discussed the most important differences between MT4 and MT5 and how understanding these differences can help traders succeed in their Forex trading career.
Trading assets
When discussing the differences between the MetaTrader 4 and MetaTrader 5 trading platforms, there are certain things that traders should be focused on. Among the most important differences is, of course, available trading assets.
MetaTrader 4 was created specifically with Forex trading in mind, which makes this platform a perfect fit for currency trading. On the other hand, MetaTrader 5 offers traders access to numerous other trading assets.
This includes assets like stocks, CFDs, indices, cryptocurrencies, and many others. At the same time, Forex traders should be informed about the fact that the availability of the trading assets also depends on other important factors as well.
When talking about the assets available on MT4 or MT5, a lot depends on the broker you are using. Some brokers limit the number of trading assets a retail trader can access, while others offer even more assets to traders.
Chart & timeframes
Another very important difference between these two trading platforms is the available chart types and timeframes. For many traders, charts are one of the most essential tools, as they can be used for technical market analysis.
Both of these platforms offer 4 types of built-in charts. These are line, bar, candlestick, and mountain charts. Choosing which type of chart to use is very simple. You just right-click on the chart and adjust the settings from there.
As for the timeframes, MetaTrader 4 offers 9 timeframes while on MT5, traders can use 21 timeframes. Offering so many timeframes is a great opportunity for traders, as it lets them analyze the market over different periods of time. This specific difference between MetaTrader 4 and 5 makes MT5 more comfortable to use for some traders.
Available order types
Both of these trading platforms offer traders different types of smart orders to make trading easier. There are 6 different types of orders available on MetaTrader 5, and 4 types on MetaTrader 4.
MetaTrader 4 offers traders the following order types:
Buy Stop
Sell Stop
Buy Limit
Sell Limit
Buy stop is used by traders to buy an asset once the price reaches a specific higher level. Sell stop is applied to sell when the price reaches a specific lower level.
A buy limit order is used once the market price reaches a level that is lower than the currency price, and the sell limit is used when the market reaches a price that is higher than the current one.
MetaTrader 5 additionally offers 2 types other orders, which are buy stop limit and sell stop limit. Buy stop limit basically combines the buy limit and stop limit orders. As for the sell stop limit, it combines the sell limit and sell stop orders.
Programming languages
Another difference between these two trading platforms is that they are using different types of programming languages for scripting new indicators or bots. MetaTrader 4 is using MQL4 and MetaTrader 5 is using MQL5.
But why is the difference between the programming languages used important for Forex traders? The programming language of the trading platform is used by some traders to create custom trading indicators or to automate their trading.
While there are numerous built-in indicators on both MT4 and MT5, some traders want to create one of their own. They believe that this way, the trading indicator will be perfectly tailored to their individual trading needs.
While both of these programming languages are based on C++, MQL5's execution time is much faster than MQL4, which is a big deal, especially for high-frequency traders. On the other hand, many hobbyist developers say that learning MQL4 is easier than MQL5.
Pros & Cons of MetaTrader 4 vs 5
Like anything else in the Forex trading market, MetaTrader 4 and MetaTrader 5 also come with several advantages and disadvantages. Now that you know what MT4 and MT5's main differences are, we can continue by discussing the major advantages and disadvantages associated with these platforms.
We will discuss them one by one below.
Advantages and disadvantages of MT4
Among the biggest advantages of using MetaTrader 4 is its functionality. With over 30 built-in technical indicators, 9 timeframes, and 4 order types, this platform can be a great opportunity for beginner traders to get started with Forex trading.
The trading platform is also known for its high-security standards. MT4 uses a 128-bit encryption scheme which is based on an algorithm with a digital signature. This ensures the safety of traders’ data.
One of the biggest advantages of using MetaTrader 4 is that it is offered by a lot of Forex brokers around the world, which means that once you are familiar with this platform, you should not have a problem using different Forex brokers.
Although very few, MT4 does have some disadvantages. One of them is the lack of available trading instruments. As we have already mentioned, this platform was specifically created for trading currency pairs, and it might not be the best choice for those who want to trade different types of assets as well.
Advantages and disadvantages of MT5
MT5 also comes with numerous advantages. It comes with over 40 built-in trading indicators, 6 different order types, and as many as 21 timeframes. Much like MT4, MetaTrader 5 offers traders the opportunity to use Expert Advisors, which are a great help for those who want to use trading automation.
MetaTrader 5 also offers traders access to numerous different asset classes, making it a great platform for traders of different interests. One of the disadvantages of MT5 is that it does not allow traders to use a hedging strategy.
Hedging is a very popular strategy employed by those who want to avoid huge losses in the market. It works by opening opposing positions on the same currency pair and is a tactic used by traders during unfavorable market conditions. Another huge drawback is that the indicators and Expert Advisors originally created for MT4 can't be used on MT5, as it uses a different programming language.
What Did We Learn From This MT4 vs MT5 Difference Guide?
MetaTrader 4 and MetaTrader 5 were both created by the same company, MetaQuotes
MetaTrader 4 offers 4 different order types, while MetaTrader 5 offers 6
There are 9 timeframes available on MT4, and 21 on MT5
MT4 uses the MQL4 programming language, while MT5 uses MQL5
Indicators and EAs created for MT4 initially can’t be used for MT5, you must create new versions.
MT5 is not an update to MT4, these are two totally different platforms
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There is no single MT4 and MT5 difference that would make any of these platforms better than the other. If you are a trader who wants to specifically trade currency pairs, then MT4 might be a better choice.
On the other hand, if you want to diversify your portfolio and trade different types of assets, it might be better to go with MT5. In terms of the actual offerings for trading activity, such as the available trading indicators, and many others things, both of these trading platforms are excellent.
Can I use the MT5 account in MT4?
In general, MetaTrader 5, trading platform and MT4 can’t be used with the same account unless there is a specific offering like this by your broker.
If the Forex broker that you are using offers both MetaTrader 4 and MetaTrader 5 platforms, you should be able to use the same account for both of the trading platforms. However, keep in mind that it largely depends on the broker you are using. Some brokers do not give traders the opportunity to use the same account for all the platforms they have.
Why is MetaTrader so popular?
Because it has been around for a very long time. The main reason behind MetaTrader being such a popular trading platform is that it has changed the way people view the Forex trading market. MetaTrader 4 was released back in 2005, and since then, it has become very popular around the world.
It is very easy to use, has a simplistic design, and gives you the opportunity to both analyze and trade currency pairs in the same environment. Both MT4 and MT5 were created by the same company and understanding the differences between MetaTrader 4 and 5 can be helpful for traders when deciding which one to use.
