MT4 vs MT5: A Detailed Comparison for Forex & CFD Traders

Similarities Between MT4 and MT5

MetaTrader 4 and MetaTrader 5 are some of the most commonly utilised trading platforms. However, before we talk about the similarities and differences between the two, we need to highlight the main features of each platform.

What is MT4? 

MetaTrader 4 was released in 2005 and quickly became a cornerstone of forex trading. It consists of two components: the client and server. The server component is run by brokers like TMGM. This means you can create a TMGM account and get free access to the client component of MT4, which grants you access to the financial markets.

It was primarily developed for forex traders, but MetaTrader 4 (MT4) also gives you access to other financial markets, including commodities and indexes, via Contracts for Difference (CFD).

The thing that made MetaTrader 4 one of the most popular online trading platforms was the fact that users could write scripts and robots known as Expert Advisors (EAs). They allow you to trade automatically based on predefined rules.

This feature is flanked by inbuilt technical indicators, analytical tools, charting, and customisation options. The one thing that’s important to note is that there isn’t an official macOS version of MetaTrader 4. That being said, it is available for iOS, and we have a custom version of MT4 for macOS users.

What is MT5?

MetaTrader 5 was released in 2010, building on the success of its predecessor, MT4. The developers at MetaQuotes developed it using MT4 as a base, but added more enhancements and features that brought it up to speed. Notably, MT5 is officially available on all operating systems, including macOS.

Beyond that, MetaTrader 5 has more tools for advanced users, including additional ways to create trading scripts using the MQL5 programming language. These advanced tools are coupled with access to a wider range of financial markets.

MT4 was primarily built for forex trading and that remains its main focus. However, it also gives you access to indices, stocks, cryptos and commodities CFDs. MT5 gives you access to more tradable assets: forex, stocks, futures, options, CFDs, bonds, and commodities, including oil.

MT4 and MT5 Similarities

From what we’ve highlighted so far, here are the similarities for the MT4 and MT5 platforms:

Key Differences Between MT4 and MT5

There are similarities between the two trading platforms, but what is the difference between MT4 and MT5? The table below provides a quick overview of the several differences between MT4 and MT5:

The MT4 vs MT5 debate doesn’t hinge on a single feature. It’s worth picking out a few of the points from above to explore in more detail:

Markets

When you’re deciding whether to use MetaTrader 4 (MT4) or MetaTrader 5 (MT5), the financial markets you’re interested in should be a key consideration. As we’ve said, MT4 was initially designed for forex, but it now offers commodities and index CFDs. For traders who want access to more markets, MT5 might be more suitable.

Integrated Tools

MT4 has fewer integrated tools, but the ones you can access are more than sufficient for the majority of commercial traders. Technical indicators, such as Moving Average (MA), Exponential Moving Average (EMA), and Moving Average Convergence Divergence (MACD), are all available by default. You can also overlay line, bar, and candlestick charts to live markets. All of these charts can be plotted over different timeframes, including 1 minute (M1), 5 minutes (M5), 1 hour (H1), as well as 1 day (D1).

If you’re an experienced trader, MT5 has advanced tools that could further elevate your trading. This enhanced toolkit includes more technical indicators and analytical objects. The Depth of Market feature allows you to delve deeper into market trends, and the ability to program advanced scripts or automated trading robots is extremely useful. It’s also worth noting that MT5 makes testing and backtesting strategies easier because you can run multiple tests simultaneously for greater efficiency.

Risk Management

When it comes to safeguarding your trades, both MT4 and MT5 excel at risk management, offering stop-loss and take-profit orders, as well as the ability to hedge positions. One edge for MT5 is its users also benefit from netting, which is trading terminology for the process of offsetting one security/currency with another position.

Unlike hedging, netting allows you to offset the position with the same security or a different one. The aim is to offset potential losses from one position with profit from the other. Another benefit of MT5 vs MT4 in terms of risk management is that it has integrated news feeds and economic calendars, so you’ve got more market insights to work with.

Choosing Between MT4 and MT5

So which platform is the right match for you, MT4 or MT5? The answer depends on your needs, preferences, and experience. The consensus among traders is that MetaTrader 4 is easier to use because it is more stripped down and has less features which could overwhelm beginners and novice traders.

The advanced charting tools, indicators, and programming language make MetaTrader 5 more suitable for experienced traders. However, that doesn’t mean you can’t use it if you’re a novice. Indeed, the fact that you can trade more instruments via MT5 might be appealing to people who don’t want to focus solely on forex and CFDs, including those looking to try out as many markets as possible.

What’s also worth noting in the MT4 vs MT5 debate is the communities that surround them. MT4 is used by more people, so there’s a larger community to draw information and support from. That doesn’t mean you can’t connect with other MT5 users and get more from the software. It’s simply that MetaTrader 4 is more widely used and, therefore, better for newbies looking for extra support.

MT4 vs MT5: Find Your Way into the Financial Markets

There isn’t a right or wrong answer when it comes to MT4 vs MT5. Both trading platforms are safe, easy to use, and packed with features to help you make better decisions. However, as we’ve said, the one you choose should be a matter of preference and necessity. Whether you prefer the streamlined and direct simplicity of MT4, or the advanced features and in-depth tools of MT5 appeals to you, both platforms are designed to empower traders and help you make the most of your trading journey.

The good news is that you can download MT4 and MT5 for free and choose the one that meets your needs. Doing this gives you easy access to the financial markets and the potential to make profitable trades on a variety of instruments, including forex and CFDs.

Unlock your trading potential and download MT4, MT5, or even both for free and experience the TMGM advantage.

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