When it comes to trading the forex market, there’s a growing number of ways in which you can access your chosen currency pairings.
The single most dominant platform is the MetaTrader 4 (MT4), which was actually developed by the MetaQuotes company back in 2005. In fact, it has remained popular despite being superseded by the MetaTrader 5 platform in 2010, as it continues to command a large market share.
In this post, we’ll compare the MT4 with the MT5, while asking which option is best for you as an investor?
The Pros and Cons of Each Platform
Perhaps the biggest misunderstanding surrounding these platforms is the idea that the MT5 is a direct successor to the MetaTrader 4, but the fact remains that there are several significant differences between the two.
While the MetaTrader 4 can be used to trade a range of markets including indices and commodities, for example, it’s design and ease-of-use particularly lends itself to currency trending. It’s as a forex platform that the MT4 has subsequently become popular and familiar with a large following of traders, with this trend showing no sign of abating anytime soon.
Conversely, the MT5 is an institutional multi-asset platform that offers a wider range of trading possibilities and technical analysis tools.
It also allows for the use of more advanced automated trading systems and copy trading, serving as a multi-dimensional, all-in-one platform that’s commonly used for stocks and futures.
The multi-market nature of the MT5 is arguably the platform’s main advantage, particularly if you’re a seasoned investor who wants to diversify and trade in both centralised and non-centralised marketplaces.
The MT5 also deals in real volume data, which offers far greater market insight and allows for more informed decision making across a diverse range of asset classes.
As for MetaTrader 4, this platform is best known for its mobility and the fact that it allows users to customise their interface and data charts. The latter point is central to the enduring appeal of the platform, as it enabled MetaTrader 4 users to develop a strong sense of familiarity and grow to rely on its core design features over time.
The timing of the MT4’s launch also coincided with the boom in Internet trading, so a large number of the platform’s users learned the fundamentals of trading here and are incredibly comfortable with its interface.
Which Platform is Best for You?
These subtle differences and advantages between these two platforms are telling, not least because they offer an insight into which one to use in different instances.
Certainly, if you’re a novice trader who’s looking to initially ply their trade in the world of forex, we’d recommend getting started with the MetaTrader 4. Not only is this app incredibly easy to use, but it’s also tailor-made for analysing forex traders and placing a high volume of orders in real-time.
However, if you already have a portfolio or are an institutional investor looking to diversify into assets such as indices and commodities, the MetaTrader 5 may offer a slightly superior and more relevant option.
Of course, it makes sense to develop a clear understanding of your needs and circumstances before comparing the market in detail, as this will help you to make the best possible decision about your next trading move!