MT4 vs MT5 – Which Software Is Better?
- MetaTrader 4 was created in 2005, while MetaTrader 5 was released in 2010
- MetaTrader 5 offers traders some new features compared to MetaTrader 4
- Among many other things, MT5 offers traders more built-in indicators than MT4
- MT4 was created specifically for currency trading, while MT5 was created with many assets in mind
MT4 vs MT5 Difference – Is There Any?
MT4 vs MT5: Created by the same software developer, there are some key differences between MT4 and MT5
While both MetaTrader 4 and MetaTrader 5 are very popular trading platforms around the world, there are some distinct differences between themes. In addition to differences, MT4 and MT5 also have a lot in common, which makes it very hard to tell which one is better.
MetaTrader 4 was created many years ago, in 2005, and has forever changed the way people trade Forex around the world. MT4 revolutionized the Forex trading market and even after so many years of its initial release, the success of the trading platform keeps growing.
There are numerous advantages that MT4 has over other trading platforms available in the market. The most notable thing about this trading platform is how user-friendly and easy to use it really is. But, the thing that makes it such a popular Forex platform is that it was actually created with Forex trading in mind.
While MT4 was designed to meet the demands and needs of currency traders, MetaTrader 5 was created with other trading assets in mind as well. Created in 2010, MetaTrader 5 was established by the same company that created MT4, MetaQuotes. MT4 was specifically crafted for Forex trading, while MT5 was designed to offer traders access to the markets like CFDs, Futures, and Stocks. You can take a look at the MetaTrader 4 USD/JPY chart with MACD indicator below.
There are some people who believe that MT5 is an upgrade of MT4, however, this is not true at all. MT5 simply offers some additional features to traders and is not an update of the MT4 platform. Because these two trading platforms are so similar to each other, it is very hard to say which one is better while talking about MT4 vs MT5.
In this guide, we are going to discover the biggest differences as well as similarities between MetaTrader 4 and MetaTrader 5 and see which trading platform is better and why.
MT4 vs MT5 Review – Key Features
While discussing the similarities and differences between MT4 and MT5, there are some key features that should be discussed. This includes things like order types, indicators, timeframes, strategies, available assets, and many others.
By understanding the key differences between these two trading platforms, you should be able to easily make a decision regarding which trading platform suits your needs best.
Both of the trading platforms allow traders to customize the trading interface according to their needs. While discussing the key features of the trading platforms, it should also be noted that MetaTrader 4 offers traders around 30 built-in indicators, while MT5 offers 38 indicators.
However, additional indicators can be downloaded online from numerous websites. As for the coding languages, MetaTrader 4 uses MQL4 language, while MT5 uses MQL5 language. While MQL5 is easier and more efficient, systems that were coded with MQL4 are not compatible with MQL5 programs.
So, let’s discover the biggest MetaTrader 4 and MetaTrader 5 difference below.
Order Types
When comparing the MT4 vs MT5 difference, it should be noted that these two trading platforms have similar execution modes. Both MT4 and MT5 offer traders three execution modes, they are instant execution, execution on request, and execution by market. However, MT5 also offers an additional execution mode, called exchange execution.
With this mode, orders are being sent to the external trading systems. In general, there are two main types of orders offered by MetaTrader 4. They are market orders and pending orders. So, let’s say that you want to buy a certain asset but you want to do so at a current price, in this case, you will be using Market Order. Here is how you open a new order on MT5.
However, if you want to buy or sell an asset at a predetermined price in the future, you will be using a pending order. The same is true for MetaTrader 5 as well.
That said, there are some differences between the order types of MetaTrader 4 and MetaTrader 5. The difference is between the pending orders. While MT4 offers 4 pending orders, there are 6 of them available on MetaTrader 5.
The available pending order types on MetaTrader 4 are the following: buy stop, buy limit, sell limit, and sell stop. As for the MetaTrader 5, it offers six order types. In addition to the ones offered by MT4, MT5 offers traders additional two order types, that are called buy and sell stop limit.
Indicators
When it comes to choosing a trading platform, it is very important to focus on the available indicators. There are numerous indicators available in the Forex trading market and they are designed to help traders better predict the future price movements in the market.
When it comes to MT4 to MT5 comparison, it should be noted that MT4 has about 30 built-in indicators and 33 analytical tools, while MetaTrader 5 offers traders 39 built-in indicators and 44 analytical objects. In addition, MT5 also offers traders DailyForex signals, which can be very helpful for traders. Here are some of the MT4 indicators.
However, it does not mean that MT5 is better than MT4 in terms of indicators. The thing about these two trading platforms is that there are numerous custom trading indicators available in both of them and you can find almost any type of indicator for both of them online.
The programming language of the MetaTrader 4 is called MQL4, and the MT5 uses the MQL5 language. While MQL5 tends to be easier and more sufficient, MetaTrader 5 is not able to run the indicators that were created with the MQL4 language.
This is a disadvantage for many. MetaTrader 4 was created many years ago and over the years there have been hundreds of indicators created for this trading platform. However, this does not mean that MT4 better than MT5.
Timeframes & Economic Calendar
In Forex trading, analysis is very important. There are numerous ways you can analyze the market. While some people prefer to focus on charts and the technical side of trading, there are others that prefer to focus on the fundamentals.
No matter which trading platform you choose to use, MetaTrader 4 or MetaTrader 5, you will be offered numerous options for both technical analysis and fundamental analysis.
However, there still are some differences between the offerings of these trading platforms. MetaTrader 4 only offers traders 9 types of timeframes. The minimum timeframe at MetaTrader 4 is 1 minute, and the highest timeframe goes up to 1 month.
As for the MetaTrader 5, it has much more time frames available for traders. The MT5 offers traders 21 different timeframes, which range from 1 minute to a yearly chart. This allows traders to analyze the market at a larger scale, which can be a huge advantage of MT5.
Another MT4 and MT5 difference are that Mt4 does not offer traders an inbuilt economic calendar section. On the other hand, MetaTrader 5 comes with an economic calendar section that can be a huge help for traders to stay up to date with the ongoing events in the market.
Strategy Testing
Although both of these trading platforms offer traders strategy testers, the strategy tester of MT4 is completely different from the one offered by the MetaTrader 5. The strategy tester of the MetaTrader 4 uses a single CPU thread, while the strategy tester of MetaTrader 5 uses multi-threads.
Also, an additional feature of the MT5’s strategy tester is that it allows you to test strategy for multiple currencies using real ticks. Simply put, the strategy tester of the MetaTrader 5 is an improved version of what MetaTrader 4 offers to traders.
Thanks to the Strategy Tester of MT4, traders are allowed to test multi-currency trading robots that are able to analyze different types of currencies and identify correlations between them.
Netting & Hedging
While working on this MT4 vs MT5 review, we were able to find out that MetaTrader 4 only offers traders hedging accounts. On the other hand, MetaTrader 5 offers you hedging as well as netting accounts.
In Forex trading, a hedging account is known to have no limitations on the number of positions that a trader can open at once. Because of this, you can have long and short open positions at the same time, on the same instrument. In Forex, a netting account brings all positions into a net position, which means that long and short positions are netted as a single position.
It is very important to better understand netting, as it can influence the way margin is calculated in Forex trading. Also, although not everyone might know, positions in hedging accounts can be closed by netting them off against one another.
Tradable Assets
While trying to compare MT4 vs MT5, we have already discussed the major differences between these two throughout today’s guide. However, there is one major thing that we have not discussed yet. It is the available trading assets on the platforms.
One of the biggest differences between these two trading platforms is that MetaTrader 4 was created with Forex trading largely in mind. As for the MT5, it offers traders access to many other trading assets as well.
On MT4, you can trade currency pairs and CFDs, while MT5 offers you access to assets like stocks, bonds, futures, currency pairs, CFDs, and many others. MetaTrader 5 is capable of connecting with the centralized exchange, which gives its users access to numerous different markets.
However, traders should also keep in mind that the available trading assets also depend on the Forex broker that they are using. While the trading platform might be able to support different types of markets, there are many brokers who want to focus on specific trading assets.
However, generally speaking, MetaTrader 5 is known to provide traders with access to a larger market, which includes Forex trading, stock trading, commodities, and many others.
What Did We Learn From This MT4 vs MT5 Article?
Both MetaTrader 4 and MetaTrader 5 were created by the same software development company, called MetaQuotes.
MetaTrader 4 was created in 2005 and mostly focuses on Forex trading, while MetaTrader 5 was created in 2010 and offers traders access to many different markets.
There are some major differences as well as similarities between these trading platforms, which makes MetaTrader 4 and 5 comparison a little harder.
Among the many differences between the trading platforms is the programming language. MT4 uses MQL4, while MetaTrader 5 uses MQL5.
Our review of MT4 vs MT5 also showed that the MetaTrader 4 has fewer in-built trading indicators compared to MT5. However, you can download different types of indicators for both of these platforms.
Common Questions On MetaTrader 4 And 5 Comparison
Is MT4 Better Than MT5?
It is almost impossible to say that one trading platform of these two is better than the other. There are many things that the answer to this question depends on. While choosing a trading platform, you should be focused on which asset you want to trade, what indicators you want to use, and many other things.
While it is true that MT5 is generally faster and more efficient than MT4, it is not possible to say that one is simply better than the other. Both of these trading platforms are very similar to each other and the differences while trading is in fact very minor.
Can I Use An MT4 Account On MT5?
No, you can’t use your MetaTrader 4 account on MetaTrader 5. However, if you are trading with a broker that offers both of these trading platforms, you might be able to switch between the two with the same trading account.
Other than that, you will be required to have different accounts for the trading platforms.