Online traders have a wide variety of tools accessible to them. Charts, statistics, and figures are some of the things that define trading.
These are not the only tools used for trading though. Software is an important part of modern trade since it is from computer programs that traders can access news, metrics, and insights about the markets. One of the most common software programs used in the trading market is MetaTrader.
This program comes in two versions – MetaTrader 4 and MetaTrader 5. Traders who are not acquainted with the market often wonder which of the two programs is better for their daily trade.
Let us look at each of these programs, their differences, and their features in order to help you determine the right program to use in your trade.
MetaTrader 4 (MT4), is a trading software that has been in the market for a long time. The program was launched way back in 2005 and it has defined modern trade. Most traders who have experience in the market have used this program at least once during their trade. In fact, the majority of the market uses this program for their forex trade.
The key issue that draws users to this platform is its comprehensiveness when it comes to trading tools. Being a pioneer, MT4 became ubiquitous with trading and its consistency has allowed it to continue being a dominant force in the trading business. In order to understand MT4, it is important to outline what it offers to traders. The following are the advantages offered by MT4:
- Charting and trading are all included on the platform
- Traders have access to almost every market
- MT4 provides automated trading for all users
- A larger resource base for traders and brokers
As you can see from the above benefits, MT4 is a fully-fledged platform that combines modern features with functionality. The convenience and versatility that this platform offers to both forex traders and brokers are unmatched.
This is what makes the platform the go-to option for beginners and advanced traders. There are various tools like the moving average indicator, market insights, and news among other things all included on the same platform.
As for MT5, the platform is newer having been launched in 2010. Being launched at a later date is not the only unique feature of the platform though. At its core, MT5 comes with features that are both alien and different from those of the older platform.
To start with, the platform allows traders to trade stocks and commodities. This is quite different from the earlier program which is designed specifically for forex traders. The design and layout might look similar to MT4 but it is definitely designed for a different target market. Other than that, MT5 is also packed with the latest and greatest in terms of features. The performance of the program is markedly better having benefited from newer technologies.
The program is also designed using a different design language and this makes its components incompatible with those of MT4. The platform also features a centralized exchange market, and this is different from the MT5 platform which has a decentralized market. Features available in the forex trading platform, like hedging, have also been excluded from the newer platform. In short, the features that characterize MT5 thus are:
- Gives traders access to the stocks and commodity markets
- The platform features a centralized trading system
- There are more technical indicators in the platform
- The program is in overall newer and faster
As the above comparisons show, the two platforms are essentially made to work for two unique markets. The MT4 platform is created for the forex market which the MT5 platform is for the stocks and commodity market. This means that the choice of the right platform is not just determined by the differences in speed and performance but also the industry choice.
In general, most traders tend to focus on a particular market. There are however those who might decide to go for both the stocks and forex markets. The most important factor to note is that forex traders will ultimately be required to go for the MT4 platform while stock traders will find MT5 to be a natural choice.