MT4 vs. MT5: Unraveling the Key Differences between Them
In the fast-paced world of online trading, MetaTrader has long been a household name among traders and brokers alike. MetaTrader, developed by MetaQuotes Software, is a renowned trading platform used by millions of traders around the globe. Within the MetaTrader family, two versions stand out: MT4 (MetaTrader 4) and MT5 (MetaTrader 5). Although they were both created by the same company, traders should be aware of a few important differences between MT4 vs MT5 before selecting a platform. To assist traders in choosing the platform that best meets their needs, we will compare and contrast these two platforms in this article, highlighting each of their benefits and drawbacks.
History and Development
In 2005, MetaTrader 4, sometimes known as MT4, made its debut. Due to its simple interface and powerful trading skills, it immediately became well-known. One-click trading and sophisticated charting capabilities were two aspects that made MT4 a pioneer among internet trading systems. It also became well-liked by other programmers, who created specialised trading robots and indicators to enhance its features.
MetaTrader 5, or MT5, followed in 2010 as an upgrade to its predecessor. It was designed to overcome some of MT4’s limitations, particularly in asset classes and timeframes. MT5 introduced more timeframes, additional technical indicators, and a broader range of assets, including stocks and commodities. As a result, several brokers kept providing both platforms side by side; others even decided to stick only with MT4.
User Interface and Features
The user interface of MT4 is straightforward and user-friendly, making it perfect for beginners. Chart customization is simple, technical indicators are simple to use, and trading is simple. Many traders favour it above others due to its familiarity and extensive use.
However, MT5 provides a better user interface with more timeframes and more sophisticated charting capabilities. Market, pending, and stop-limit orders are just a few of the additional order types it provides, making it a favoured platform for traders that need in-depth analysis.
Overall, MT5 offers a more advanced collection of tools than MT4, despite the fact that both platforms are user-friendly and offer a variety of capabilities. However, some traders might prefer the more straightforward MT4 interface, especially if they are new to trading and want to know how to start forex trading or don’t need the more sophisticated MT5 capability.
Programming Languages
Syntax: Both MT4 and MT5 use MQL (MetaQuotes Language) for programming custom indicators and trading algorithms. While the syntax is similar, MT5 introduced more functions and data types, providing greater flexibility to developers.
Object-Oriented Programming: MT5 takes a step forward by introducing object-oriented programming (OOP). This feature allows developers to create more complex and structured trading robots, enhancing the overall trading experience.
Backward Compatibility: One key difference is that MT4 scripts and indicators are not directly compatible with MT5 because of the variations in syntax and OOP support. Unlike advanced code, which may need to be completely rewritten, some code can be changed with ease.
Functionality: MT5’s improved functionality is evident in its ability to handle more timeframes and economic calendars, offering traders a more comprehensive view of the market.
In the end, the choice of programming language will depend on the requirements and preferences of the specific trader.
MetaTrader Indicators and Tools
Both MT4 and MT5 offer a wide range of built-in technical indicators and tools:
Testing Modes: Both platforms support backtesting, allowing traders to assess their strategies using historical data. MT5, however, offers additional testing modes, such as multi-threaded optimization, providing quicker and more accurate results.
Speed and Accuracy: MT5’s faster execution speed and improved accuracy in backtesting and optimization make it a preferred choice for algorithmic traders and developers.
Optimization: MT5’s optimization features include genetic algorithms and cloud network support, further enhancing its capabilities for strategy development and testing.
Reporting: MT5 offers more detailed and customizable reporting tools, providing traders with a deeper understanding of their trading strategies’ performance.
Overall, MT5 is a more appealing option for traders who demand exact and thorough testing results due to its more sophisticated tools and quicker testing engine.
Security and Reliability
Data Encryption: Both online platforms encrypt user data, including login information and trade activity, using 128-bit SSL but MT5 has made significant advancements in data encryption, ensuring that sensitive information remains secure during transactions.
Server Uptime: The MetaQuotes servers are used by both platforms to execute trades and store data but MT5’s server architecture is more robust, resulting in minimal downtime and ensuring uninterrupted trading activities.
Potential Vulnerabilities: While both platforms are secure, MT5’s continuous development and security updates make it less susceptible to potential vulnerabilities.
Custom Indicators and Trading Robots: Developers have more options and flexibility in creating custom indicators and trading robots in MT5, with its enhanced programming capabilities and support for multi-currency testing.
Market Adoption and Support
Over 1,000 firms are planning to provide MT4 as a trading platform by 2021, due to its longer presence in the market, still enjoys a higher adoption rate among brokers and traders. It has a vast community of users and extensive online resources for support.
It has not gained as much popularity as MT4, and as of 2021, just 400 firms are thought to be offering MT5 as a trading platform. As the trading community becomes more familiar with its advanced features, its adoption is expected to continue growing.
