What To Choose: MetaTrader 4 or MetaTrader 5?
In 2010, MetaQuotes released the latest version a successor, MetaTrader 5 (MT5). However, uptake was slow and many forex traders still use MetaTrader 4 (MT4). Why? What is your choice? This article explains the differences between MetaTrader 4 and MetaTrader 5
The graphical user interfaces in MetaTrader 4 and 5 look and feel fairly similar. But the major difference is on how MetaTrader handle trading orders.
MetaTrader 5 was bulit in compliance with the US’s “no hedging rule”, which states that clients of Forex brokers in the US. must deal on a FIFO (First In, First Out) basis. For example a trader open long position 1 lot of EUR/USD, and then add another 1 lot of EUR/USD. While Metatrader 4 logs every trade individually and allows for management of each individual position separately, Metatrader 5 automatically aggregates all positions. Therefore, only Metatrader 4 can deal with hedging: Metatrader 5 cannot. This is fine for traders in the US as they are legally barred from hedging in any case. But, many traders find an inability to execute hedging operations a very annoying an unnecessary handicap. However, hedging can be used as a money management strategy. It is probably the major reason why many traders still prefer using MetaTrader 4 than MetaTrader 5.
Beside the major difference, there are a number of other differences worth mentioning within any MT4 and MT5 comparison.
MT5 uses a programming language called MQL5 as opposed to the MQL4 used by Metatrader 4. Programs written for MetaTrader 4 cannot run on MetaTrader 5. In MT5 there are two related advantages over MT4. Firstly, its faster back testing functions. Second, it also allows simultaneous multi-currency pair back testing.
MT4 takes up less memory space compared to MT5.
MT5 offers 21 timeframes including Tick, whereas MT4 offers only 9.
MT 5 offers unlimited number of charts, out of which 100 can be opened at a time, whereas MT4 offers limited charts
MT5 offers 38 inbuilt indicators, and 68 analytical tools, whereas MT4 offers 30 inbuilt indicators and 33 analytical objects.
MT5 user gets the benefit of an inbuilt forex calendar. Features like news events, schedules, expected impacts, forecasts are also included in this calendar. MT4 does not have this feature.
Choice of brokers
Many forex brokers offer MT4 more compared to MT5. So if a trader selects MT4 for trading, he or she can choose a wide range selection or brokers. Moreover, majority of forex brokers offer key services on MT4 only.
WHAT TO CHOOSE?
The answer to this question should seem pretty clear after reading the above MT4 and MT5 comparison. Although both MT4 and MT5 have their own advantages and disadvantages, still MetaTrader 4 has been found to be more popular in the forex trading. If you have to comply with US regulations for whatever reason or doesn't need hedging, then MetaTrader 5 is the obvious choice for you. But if not, it is highly recommended to use Metatrader 4, which remains a gold standard platform of the forex trading industry