Notes

MetaTrader 4 or MetaTrader 5? A Guide for New Online Trading


If you start trading and investing online, whether that's experimenting with buying some stocks or crypto for the first time or fancy trying your hand at some real trading of stocks, forex, and commodities, sooner or later, you will come across MetaTrader 4 (MT4) and MetaTrader 5 (MT5). forex.com metatrader 4 demo They are trading platforms; software packages that allow traders to execute their trades. They are free to use, but usually these platforms are accessible via an online broker's platform.



MT4 or MT5 is not the only trading platform available. There are many others, but MT4 and MT5 remain the most popular amongst both retail and professional traders. MetaTrader 5 was supposed to be the successor of MetaTrader 4. You might think that it is like choosing between an iPhone 14 or an iPhone 15; an upgrade. It's not as simple as that. A better way of thinking about it is that the two platforms have different target markets, designs, and features. In short, neither is objectively better than the other overall.

Trading Platforms Overview
The fintech revolution of the 2000s saw a mass movement of trading activity online. Major online brokers launched, offering services to retail and professional traders alike. Those brokers would usually offer their own proprietary trading platforms - many still do - to their clients. Platforms are software suites that allow traders to access charts, data and educational resources.

MetaTrader was first launched by MetaQuotes Software in 2002, releasing several versions until catching lightning in a bottle with MT4, which was released in 2005. In the late 2000s many online brokers began adding MT4 as a platform to their trading platforms because of its popularity. MT5 was launched in 2009. Brokers also adopted it because of its popularity. Almost all major brokers will now offer both MT4 and MT5.

You will see that MT4 has been around for almost 20 years (was the predecessor to the iPhone), and MT5 has been around for 15 years. But it's important to note that they are not clunky old software packages; they have evolved in that time through updates from MetaQuotes Software and third-party developers through open-source architecture. As such, there is a reason we haven't seen MetaTrader 6 yet - there's effectively no reason for it.

MetaTrader 4
As mentioned, MT4 was released in 2005 and soon became the world's most popular trading platform. MT4 held that title for many years. However, in 2021, MT5 overtook it as far as the number of brokers that offered it. MT4's main focus is forex trading, and it was designed for that purpose. It is also a superb choice for those who wish to trade CFDs (contract for difference). With MT4, you can trade commodities, metals and energy assets as well as indices. It is easy to use and is popular with those who prefer automated or algorithmic trading. The MT4 community has grown over the years with millions of users.

MetaTrader 5
MT5 has a broader scope in terms of tools and features than MT4. On the surface, using MT5 is just as easy as MT4. In fact, the UX of both platforms is fairly similar. MT5 has a wider range of assets. Stock trading is a highlight, which MT4 lacks. It has more charts, chart drawing tools and built-in indicators that can be customised than MT4. Additionally, it offers advanced order types and execution methods. It is, as such, an upgrade on MT4. As we will argue in the following paragraphs, this does not necessarily mean that it is objectively superior. MetaQuotes is also more focused on updating MT5 compared to its predecessor.
Here's my website: https://www.fxcm-markets.com/metatrader-4/