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Generally speaking, trading platforms are third-party software systems that allow investors to open, close and manage their market positions through an intermediary – such as an online broker like NAGA.
Essentially, they give investors an interface to access markets and place trades. These platforms frequently offer an easy-to-use and understand interface that can be very helpful for beginner investors.
The ideal trading platforms can also include many sophisticated tools and features designed to help investors make decisions. These include real-time quotes, live financial news, and interactive charts designed to aid investors.
No two platforms are alike, and when choosing a platform, traders and investors should consider whether the features on offer meet their trading needs. This is where the MT4 vs MT5 question comes in.
In today's always-online world, traders often overlook one element - the availability of the trading platform. That is to say – how mobile-friendly is it? Is it available for the most popular operating systems like Windows, Mac, iOS, and Android?
Now that you have a general idea of what a trading platform is and what it can and (ideally) should do – let us take a deep-dive look into two of the most popular trading platforms around the world: MetaTrader 4 and MetaTrader 5.
MT4, or MetaTrader 4, is a trading platform that MetaQuotes released in early 2005. The platform gives traders across the world the opportunity to trade in the global forex market. Intuitive and straightforward, MT4 quickly became popular among traders across the globe. If efficiency is the name of your trade game, then MT4 might be just the platform for you.
Often considered the gold standard platform of the retail Forex / CFD (Contract for Difference) trading industry, it covers traders of all experience levels.
New traders appreciate the platform's beginner-friendly elements, such as the copy trading system and automated Expert Advisor apps. The more experienced can take advantage of a full suite of complex analytics, charting tools, and the ability to design their own trading indicators.
Here are some key features of MT4:
In 2010, MetaQuotes developed and released MetaTrader 5 (MT5). It is a powerful trading platform that allows you to trade stocks, CFDs, forex, and futures. MT5 offers various features to its users, such as automated trading, copy trading, virtual hosting service, and technical and fundamental analysis tools for strategy development.
The platform allows you to open 100 charts simultaneously, and the 21 timeframes enable detailed analysis of even minor price movements. It also offers 80 technical indicators and 44 analytical objects.
MetaTrader 5 checks all the boxes; advanced traders will appreciate the multi-asset, multi-functional platform that provides price data as well as unparalleled technical and analytical tools. Day traders will enjoy a trading platform that's fast, reliable, powerful, and robust.
Key features of MetaTrader 5:
MetaTrader 4 and MetaTrader 5 offer various tools for their users, making them the most accessible platforms within the industry. However, there are some differences between the two.
MetaTrader 4 is truly an innovative trading platform. Released back in 2005, it offered traders unparalleled comfort and opportunities. The main idea behind MT4 was to provide an all-in-one platform for Forex trading. Thanks to MT4, forex trading became more efficient and easier to access.
Five years after the roll-out of the MetaTrader 4 trading software in 2005, MetaQuotes released MetaTrader 5. The introduction of MT5 extended the functionality to include more instruments and several other additions.
Some people believe that MetaTrader 5 is an update and direct successor of MetaTrader 4 - this is not exactly true. Instead, both platforms co-exist in the trading markets, offering traders different opportunities. MetaTrader 4 was mostly created for Forex trading. MetaTrader 5 allows investors to trade different types of assets, including CFDs, stocks, and futures.
Key differences between these two platforms include:
The user interface of the MT4 is straightforward and easy-to-understand. Novice and seasoned traders alike appreciate this functionality. Users also highly value the platform because it is configurable, meaning that you can tailor it to suit your trading requirements.
MT4s programming language (MLQ4) is also more straightforward and superior to program than that of MT5 (MLQ5). Some consider MT4 as the superior platform because of its ease of use and functionality. Forex trading on the MT4 platform is also second to none.
The MT5 platform is, in many ways, an upgraded version of MT4. Seasoned traders will absolutely love its enhanced capabilities and additional components.
They give users an unmatched understanding of the market and help in decision-making. However, all the extra functionalities may appear a little overwhelming to newer users and traders.
Metatrader 5 does have two significant programming benefits over Metatrader 4. First, its backtesting (assessing the success of a trading strategy) functions allow you to test programmed trading strategies and operate significantly faster.
Traders who run many backtests will find this feature particularly helpful as it can save them a great deal of time. It also permits simultaneous backtesting of multiple currency pairs.
Ultimately, which of the two platforms is better depends on the preference of the individual trader. If you are looking for a platform that can offer more symbols and markets, more order types, and partial fills, then Metatrader 5 could potentially be a better match. Users looking for a program that is both easy to understand and configure will greatly appreciate the no-nonsense execution that comes with Metatrader4.
Some may argue that MT4 is outdated and a switch to MT5 is inevitable. Others may argue that with nearly two decades of proven experience, MT4 is irreplaceable. But both these viewpoints are shortsighted.
It is vital to understand that both the MT4 and MT5 platforms service a core purpose suited to a specific audience. That is to say, both platforms are ideal for traders who wish to perform advanced technical analysis and deploy custom trading strategies that best fit their personal needs and preferences.
MetaTrader 5 should not necessarily be viewed as an update to the fourth version; instead, it is an entirely new platform with its advantages and qualities.Both platforms have advantages and disadvantages, so knowing which is right for you is important. The choice of a platform boils down to your personal financial goals and experience.
Both platforms are available in the form of desktop software, mobile apps, and even directly through web browsers.
To answer which is better is impossible. The industry continues to evolve, advance, and move forwards, and whatever platform you decide will best suit your needs in your trading journey – here at NAGA, we have everything you may need to get started.
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Maxim Bohdan
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