8 major differences between MT 4 and MT 5

It is the advanced trading platforms that make financial market trading successful and effective. Various financial service providers allow trading on ultra-modern tools such as MetaTrader 4 and MetaTrader 5. Both these platforms have their own benefits. Today, through this guide, we will throw light on some major differences between both these platforms.

What is MetaTrader 4?

MT 4 is an acronym for MetaTrader 4 trading platforms developed in the year 2005 by MetaQuotes. This platform is commonly used for trading forex. However, you can also trade a wide range of financial markets, including commodities, cryptocurrencies, forex, indices through CFDs.

It is an extremely famous platform because it is extremely customisable depending on your trading preferences. You can employ the same to automated your financial trading using computational programs and algorithms that close and open trade offers on your part as per the set parameters.

What is MetaTrader 5?

Meta Trader 5 is a multi-functional, multi-asset, and institutional trading platform. Though this application has not received popularity compared to Meta Trader 4, MT 5 facilitates commodities and stock trading, unlike MT 4, which majorly focuses on foreign market exchange trading.

It is compatible with mobile, web, and online versions. It also provides traders with extra trading services such as integrated robots for trading, a freelance database, virtual hosting service, and copy trading. The platform offer services in 31 different languages, making it accessible for traders worldwide.

Which one is better MT 4 or MT 5

1) Interface of platforms

a) MT 4 Interface

MetaTrader 4 is easy and simple to use for foreign exchange investors. It allows traders to customise the interface, change the trading algorithm as per their needs. They can change it, keeping their trading objectives in mind.

b) MT 5 Interface

The successor of MetaTrader 4 is MetaTrader 5. It has some extra and advanced features such as functions to trade stocks and futures. The platform's interface is more or less similar to MT 4, with the major difference in the number of services, advantages, and timeframes.

2) Time Frames

MetaTrader 4 has nine different time frames. On the other hand, you get 21 integrated time frames in MetaTrader 5. It includes seven kinds of hourly trading graphs/charts, eleven kinds of minute graphs/charts, and yearly, weekly, and daily time frames. These time frames boost trading by providing exposure to market analysis.

Time frames for MetaTrader 4: MN, W1, D1, H4, H1, M30, M15, M5, M1 Time frames of MetaTrader 5: H6, H4, H3, H2, H1, M30, M20, M15, M10, M6, M5, M4, M3, M2, M1

3) Pending orders in MetaTrader

Pending order can be defined as a set of instructions to sell or purchase a financial instrument when trading conditions specified by the investor (beforehand) are met. The pending order is something which investors tell their broker that they do not wish to execute a trade on the current financial price. However, they only wish to execute the order in case the price attains a certain level or goes above this level. There are two major types of orders firstly, stop orders and, secondly, limit orders.

MetaTrader 4 provides only four pending orders. On the other hand, MetaTrader 5 provides six types.

Pending orders of MetaTrader 4: Buy limit, Buy stop, Sell stop and sell limit

Pending orders of MetaTrader 5: Buy limit, Buy stop, Buy-stop limit, Sell limit, sell stop, Sell-stop limit

4) Programming language used in the MetaTrader platform

The programming language of MetaTrader 4 is MetaQuotes Language 4. On the other hand, MetaTrader 4 uses MetaQuotes Language 5. Now you must be wondering What is MQL 4? What is MQL 5? Let's find out.

a) MT 5: MetaQuotes Language 5

A high-level programming language such as MetaQuotes Language 5 is used to create a trading robot and several extra features, including scripts, technical indicators, utility applications, and function libraries.

It is employed for implementing the positional system.

Through this, investors can edit and write scripts.

Easier to use and effective.

The entire trading proceeds by sending a request through a single function.

b) MT 4: MetaQuotes Language 4

A programming language such as MetaQuotes Language 4 is integrated for developing trading strategies.

You cannot execute programming of MT 4 on MT 5

It is simpler than MQL 5

To execute functions with MQL 4, you require multiple functions

The programs related to trade orders are developed by using MetaQuotes Language 4

5) Hedging

In MetaTrader 4 you only get hedging whereas in MetaTrader 5 you get both netting and hedging (on request). Now, What is hedging? Also What is netting?

Hedging: One can define hedging as the method of protecting your funds or finances from financial risk or risky conditions. Traders usually employ this to offset or mitigate the possibilities that can lead to losses in a given trade. Further, the other main advantage of hedging is limiting your trading losses to a recognised value if the price of the asset continues to lose its value.

Netting: One can define netting as a means through which a trader or investor can mitigate an obligation or exposure by merging several positions (two or more). The process proceeds by offsetting and analysing several positions, and finally, the parties are determined (pay and to be paid) Multilateral netting usually comprises more than two participants. In the financial market, traders use netting for inter-company transactions, credit agreements or during trading.

6) Analytical tool for market analysis

Analytical tools play a crucial role in determining the exit and entry trade points. Also, they assist in reaching potential trading decisions. It directly impacts your trade and helps you to harvest most of the financial market. Several renowned and reliable firms like T1markets offer advanced research and analytical tools to their clients apart from those which come preinstalled with MetaTrader.

MetaTrader 4 provides technical analysis tools that enable you to analyse financial market conditions of any tricky level. It includes:

Free custom indicators more than 2000

30 integrated technical indicators

About 700 paid technical indicators

MetaTrader 5 offers the following indicators for technical and market analysis:

About 44 analytical objects

Unlimited number of graphs and charts

38 technical indicators

21 timeframes

7) Market depth

MetaTrader 4 lacks the feature DOM. On the other hand, MetaTrader 5 facilitates traders with DOM or depth of market. It helps in setting bids and providing several financial securities at fluctuation or changing prices. This function entirely depends on the volume of trade.

8) Economic Calendar

MetaTrader 5 provides the most important research tool, i.e. economic calendar to its users. This function successfully delivers each update about macroeconomic events and other financial events from several countries that may influence the price of financial assets and markets.

The Bottom Line

Both MT 4 and MT 5 have their own advantages and disadvantages. The former is easy to use and contains more technical indicators. On the other hand, later, it is complex to understand for novice traders but has many advanced features that can boost your trading. The selection of platforms depends on your trading preferences and objective.