Have you also been thinking, 'Should I opt for MT4 or MT5?" Are you supposed to make a move or stick to what is familiar and easy to use?
Forex traders have a preference of which trading tool they choose to use. This option is interlinked with the choice of Forex traders since not every sort of trading channel is provided by every broker. In addition, certain brokers do not have full connectivity with some Forex trading sites but provide access to them via a bridge, a piece of software that links the Forex broker trading device to the network.
This might operate well. However, if the bridge malfunctions or breaks down, it may negatively affect the execution and the administration of exchange. Another reason being that technology is continually changing and that what works in the current years may become redundant in the future.
What You Should Know About MT4 and MT5
The contrast of two of the largest trading platforms has been going on for a while now. It's only lately that the conversation has escalated. MT4 has been around for a long time now. It was released in 2005, which is 16 years old. It sets the industry benchmark for the Forex trading site, which is why many Forex traders are selling it. It's an underestimation to suggest it's common. Most of the Forex traders have become familiar with the MT4 platform.
On the contrary, MT5 entered the industry in 2010. Since not many Forex brokers are selling it, it's not as common. This doesn't mean that it's not worth trying. This is particularly true if you are selling commodities, bonds, options, or futures on top of currencies. A big distinction between these trading systems is that MT5 serves these markets also, apart from Forex. MT5 also comes with features not present on MT4, and any parallels are enhanced.
Though MT4 and MT5 function on similar interfaces, MT5 offers extra services and features. MT4 was develop using the MQL4 programming language, and MT5 was develop using the MQL5 programming language.
Let us now dive into the key differences between the two leading platforms in the trading industry.
MT5: Forex, Futures, Bonds, Stocks, Options
Earlier in this article, it was stated that both trading platforms, MT4 and MT5, support the Forex markets. However, MT5 goes on to support additional multiple markets, including futures, bonds, stocks, and options.
It also acts as a portal to foreign exchange markets, linking investors to various exchanges around the world, including the Chicago Mercantile Exchange (CME), the Dubai Gold and Commodity Exchange (DGCX), and the Moscow Exchange (MOEX). The three key types of securities sponsored by MT5 are stocks, futures, and shares.
MT4: 9 Timeframes
MT5: 21 Timeframes
The MT4 trading platform offers 9 timeframes, whereas the MT5 trading platform offers 21 timeframes from which the hourly charts are of 7 categories and the minute charts are of 11 categories. Timeframes of 2, 8, and 12 hours are offered to the day traders.
Both MT4 and MT5 come with a range of analytical methods that are used to detect cycles and levels of support and opposition, to create networks, recognize market patterns in financial instruments, and more. The MT4 trading platform offers 31 graphic objects, and the MT5 trading platform offers 44 graphic objects, which also contain the Buy and Sell sign, the Construction of Waves, and the Regression Channel.
Order Execution Types: There are four types - instant execution, market execution, request execution mode, and exchange execution mode. The MT4 trading platform supports the first three types and excludes the exchange execution mode. On the other hand, the MT5 trading platform offers support to all four order execution types. The fourth type, namely, the exchange execution mode, processes the transferring of trades to an external trading mechanism. It carries out the execution at the existing market price.
Backtesting / Strategy Tester: MT4's strategy tester is single-threaded, whereas MT5's strategy tester is multi-threaded, including multiple currencies and real ticks.
Pending Order Types: MT4 has 4 pending order types, and MT5 has 6, including the Buy Stop Limit and Sell Stop Limit as additions.
Hedging: This system is supported by both trading platforms. However, MT5 included hedging as a secondary accounting system.
Depth of Market (DOM): MT4 does not have a DOM functionality. It is present on MT5.
Economic Calendar: MT4 does not have an economic calendar. It is present on MT5.
Partial Order Filling Policies: MT4 does not have this functionality. It is present on MT5.
Order Fill Policy: MT4 offers 'Fill or Kill' and MT5 offers 'Fill or Kill', 'Immediate or Cancel', and 'Return'.
Nettling: MT4 does not have this functionality. It is present on MT5 because it was designed on this type of accounting system.
Reports: MT4 offers tables only in reports, and MT5 offers charts and tables.
Balance Transaction Types: MT4 offers balance and credit. MT5 balance, credit, bonus, interest, charge, commission, correction, and agent.
Email System: An email system is present on both trading platforms. But MT5 additionally offers the attachments feature.
Account-to-Account Fund Transfer: MT4 does not have this functionality. It is present on MT5.
Multilingual Unicode: MT4 does not have this functionality. It is present on MT5.
Embedded MQL5 Community Chat: MT4 does not have this functionality. It is present on MT5.
MT5 offers many additional functionalities and services over the MT4 trading platform. However, the selection should be made based on your plans, needs, and trading operations.