With both designed by MetaQuotes, they possess robust features to support an immense number of trading strategies.
However, each has its own strengths, and understanding these differences will help you make an informed decision based on your needs and goals as a trader.Â
In this article, we’ll break down the features, advantages, and drawbacks of both MT5 and MT4 to help you choose the right platform for your forex trading journey.
1. What is MT4 and MT5?
Before comparing features and differences, let’s do a quick review of what each one offers.
MT4 (MetaTrader 4) is the older of the two, which was released in 2005. It soon gained favor as the leading platform for forex traders due to its ease and stability. MT4 is indeed a powerful trading tool, featuring everything a beginner trader would need: technical analysis, charting tools, and even automated trading. Although it is an older platform, its stability and ease of use keep it very well liked.
MT5 (MetaTrader 5) was developed and released in 2010, representing a new generation compared to MT4. However, it is more complicated than MT4, so MT5 is not as widely adopted by traders, especially those who are beginners, since the learning curve is much higher. At the same time, MT5 has improved on many aspects compared to MT4: MT5 is designed to handle a broader range of financial instruments and provide more advanced analytical functionality.
2. User Interface and Ease of Use
As one gets started with forex, this user-friendly interface plays a decisive role in the pace with which you will learn this or that trading terminal and also work with it afterward. So far as the interface is concerned, MT4 outplays its more advanced counterpart MT5 among beginners.
MT4 boasts a simplistic and minimalistic interface, engineered for ease of use. The tools are all easy to access, and charting is intuitive. You can focus on the trade without being overwhelmed by countless options. The ease of operation of this platform is another primary reason it remains the go to choice for new traders.
On the other hand, MT5 has a more complicated interface that includes additional features such as multi-timeframe charts, an economic calendar, and improved order management. While these features are great for experienced traders, they can be a bit much for someone just starting out. The layout is more intricate, and it may take some time to get used to. However, once you become familiar with the interface, MT5 offers a more modern and feature-rich experience.
3. Charting and Technical Analysis Tools
Both platforms are known for their robust charting and technical analysis tools. As a beginner, you’ll rely heavily on these tools to make informed decisions. So, it’s important to understand how each platform compares in this area.
MT4 comes with the standard set of charting tools: trend lines, moving averages, and a host of technical indicators. The charts can be fully customized to suit one’s trading style, and MT supports several time frames for technical analysis. However, indicators and charting tools are in a limited number compared to MT5.
MT5, on the other hand, is an advanced platform with a greater variety of tools for technical analysis. It offers a greater number of timeframes, chart types, and technical indicators, which can provide a far more detailed and comprehensive look at the market. If the trader intends to scale a trading strategy over time, these additional features are extremely important. However, for a beginner, it may be a bit overkill at first.
4. Order Execution and Order Types
Both platforms are designed to handle order execution with ease, but MT5 has a few more order types that will make your trading experience even better.
MT4 provides support for basic order types, including market orders, limit orders, and stop orders. Most beginner traders find these order types sufficient. The execution is fast and reliable, while the platform handles orders pretty well, making it a breeze to trade.
MT5 continues this by adding more advanced order types, such as Buy Stop Limit and Sell Stop Limit orders. These extra options might be very useful in maintaining trades. MT5 supports partial order filling, which also gives a trader more control over how their trades are filled. While this is a big plus for more advanced traders, this may be overkill for beginners at the beginning.
5. Asset Classes and Market Coverage
For a beginner, you want to start on a platform that has multiple asset classes available for trading to diversify your portfolio over time.
MT4 is more focused on forex trading and is a perfect platform for those who would like to specialize in this area. Although some brokers offer CFDs on commodities, stocks, and indices through MT4, the platform is more limited in terms of asset classes.
MT5, on the other hand, supports a wider array of financial instruments. Besides forex, you can trade stocks, indices, commodities, and even cryptocurrencies. This makes MT5 a great choice for those who want to diversify their trading activities and explore different markets. However, this expanded market coverage can be a double-edged sword for beginners who may feel overwhelmed by the variety of options.
6. Automated Trading and Expert Advisors (EAs)
Automated trading through the use of Expert Advisors is one of the most important aspects of trading for many users. It allows you to set predetermined conditions and have the software automatically execute trades on your behalf. This can be quite useful for both novice and experienced traders alike.
MT4 is well-known for its superior EA support. It’s easy to use, and many traders have developed successful EAs for the platform. As a beginner, you may not need automated trading immediately, but when the time comes, MT4’s EA functionality is intuitive and widely supported by the trading community.
MT5 also supports EAs but, being more complex and with the new programming language, it is a bit more difficult to develop and deploy custom EAs. In general, for a newcomer, the learning curve that comes with MT5’s EA system will be somewhat steeper than MT4. But if you plan to delve more deeply into automated trading later, then MT5 does offer far more advanced functionality.
7. Speed and Performance
Both MT4 and MT5 are highly reliable platforms with excellent performance, though there are some differences in speed.
MT4 is optimized for fast order execution and operates smoothly with relatively low system resource usage. As for beginners who are still fiddling around, learning the ropes, the performance that MT4 provides is sufficient.
MT5 is designed to handle more complex tasks, which can make it slightly heavier on system resources. However, its performance has been significantly improved compared to MT4, particularly in terms of speed, especially when handling larger quantities of data. The platform is more suitable for experienced traders who need advanced capabilities like backtesting on multiple assets simultaneously.
8. Mobile Trading
Having access to mobile trading is an important consideration as a beginner. Both MT4 and MT5 have mobile applications for iOS and Android, enabling you to manage your trades anywhere.
MT4’s mobile application is very simple and user-friendly. You can easily place trades, monitor charts, and manage your positions from any location. It mirrors the desktop experience but is more streamlined, which can be appealing to beginners.
Where the MT5 mobile application offers more functionality, such as trading of several asset classes and access to more technical analysis tools, this is a plus for the more advanced trader but can be somewhat confusing for a beginner when on the move.
9. Community and Support
Every trader, especially a beginning one, needs a strong community and reliable customer support. MT4 and MT5 have huge online communities and plenty of educational resources to get you started.
With more than ten years on the market, the active community of traders using MT4 is enormous, tutorials abundant, forums ready to answer, and plenty of third-party learning materials. Moreover, due to its high popularity, brokers with MT4 support are virtually innumerable.
MT5, although newer, has a growing community. As it gains momentum, more educational resources and expert advice are available. The platform also has an enhanced help system, with more detailed documentation to guide you through its features.
10. Which Platform is Better for Beginners?
Deciding between MT4 and MT5 ultimately comes down to your trading goals and how much time you’re willing to invest in learning the platform. For beginners, MT4 is generally the better option. Its simplicity, ease of use, and focus on forex trading make it an ideal platform for those just starting out in the world of online trading.
MT5 is more advanced, with added features, and is worth considering if you plan on scaling your trading strategy in due time. For beginners, however, it’s a bit overwhelming. If you decide to use MT5, make sure you invest time in learning its features gradually so that you can fully take advantage of its capabilities.
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Frequently Asked Questions (FAQs)
Can I use automated trading (EAs) on both MT4 and MT5?
- Yes, both terminals can function with automated trading by EAs. MT4 is really well known for its excellent functionality of EA, and also a large number of traders and developers develop various EAs. MT5 does support EAs as well, with even more impressive functionality; however, beginners may face some difficulty in mastering its features.Â
Does MT5 support more assets than MT4?
- Yes, MT5 has support for a wider range of financial instruments than MT4. Besides forex, MT5 lets you trade stocks, commodities, indices, and cryptocurrencies, thus making it more versatile for traders looking to diversify their portfolios. MT4, on the other hand, is focused mostly on forex trading.
Is mobile app trading possible on MT4 and MT5?
- Yes, both have mobile applications for iOS and Android. MT4 has a basic mobile application for simple trading functions such as giving orders and monitoring your trades. The MT5 mobile application is more advanced with access to multiple asset classes and deeper charting capabilities, though it may be more difficult to use for beginners.
