Here’s a question which has probably crossed the minds of many retail forex traders: Is MT5 better than MT4?
It only takes a quick search online to see that MT4 is clearly the more popular of the two, both from a forex traders’ perspective as well as brokers’ offerings.
But why is this the case? After all, MT5 is newer software and has some great improvements over its predecessor, such as more chart timeframes and a greater range of default indicators.
One could argue that the problem lies with the fact that more brokers offer MT4, and that not many have started supporting MT5. This is true, to an extent, but brokers will always offer those platforms that traders are using the most, and so it’s prudent to look at why traders themselves haven’t necessarily been demanding MT5 support.
Perhaps the biggest reason is the programming language called Expert Advisors. Called EAs for short, these are the automated trading systems that MetaTrader is popular for. Programmed code written for MT4 EAs will not work with MT5. This is a drawback for those forex traders that devoted much time and energy learning how to code for MT4 to build their own strategies; not to mention those that have built their preferred library of EAs over time, and do not want to have to trawl the web for those same indicators to work with MT5. Custom indicators tell the same story: those written for MT4 will not work with MT5.
Hedging is another factor. MT5 does not allow investors to have concurrent trades running in opposite directions. It’s a significant omission for those looking to temporarily hedge when the opportunity arises.
The interface also warrants a mention here. Although the same layout is mostly retained between MT4 and MT5, the buttons on the newer platform are slightly larger and therefore take up more precious screen real-estate. A small issue perhaps, but when the focus should be on charts and pricing– the more screen space the better.
Personally, I think traders’ habits play a big part in the popularity (or lack thereof) of MT5. It takes no small amount of time and effort to learn, and customise, a new trading platform and forex traders have enough to concentrate on with their strategies alone. The old saying ‘if it ain’t broke, don’t fix it’ rings particularly true in this case.
MT4 is a great platform, especially once you get to know its ways. Until there are compelling reasons to change – with no downsides – I have a feeling that MT4 will remain the most popular for some time.
Spread bets and CFDs are leveraged products. Spread betting and CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.This information has been prepared by IG, a trading name of IG Markets Limited. The material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
It only takes a quick search online to see that MT4 is clearly the more popular of the two, both from a forex traders’ perspective as well as brokers’ offerings.
But why is this the case? After all, MT5 is newer software and has some great improvements over its predecessor, such as more chart timeframes and a greater range of default indicators.
One could argue that the problem lies with the fact that more brokers offer MT4, and that not many have started supporting MT5. This is true, to an extent, but brokers will always offer those platforms that traders are using the most, and so it’s prudent to look at why traders themselves haven’t necessarily been demanding MT5 support.
Perhaps the biggest reason is the programming language called Expert Advisors. Called EAs for short, these are the automated trading systems that MetaTrader is popular for. Programmed code written for MT4 EAs will not work with MT5. This is a drawback for those forex traders that devoted much time and energy learning how to code for MT4 to build their own strategies; not to mention those that have built their preferred library of EAs over time, and do not want to have to trawl the web for those same indicators to work with MT5. Custom indicators tell the same story: those written for MT4 will not work with MT5.
Hedging is another factor. MT5 does not allow investors to have concurrent trades running in opposite directions. It’s a significant omission for those looking to temporarily hedge when the opportunity arises.
The interface also warrants a mention here. Although the same layout is mostly retained between MT4 and MT5, the buttons on the newer platform are slightly larger and therefore take up more precious screen real-estate. A small issue perhaps, but when the focus should be on charts and pricing– the more screen space the better.
Personally, I think traders’ habits play a big part in the popularity (or lack thereof) of MT5. It takes no small amount of time and effort to learn, and customise, a new trading platform and forex traders have enough to concentrate on with their strategies alone. The old saying ‘if it ain’t broke, don’t fix it’ rings particularly true in this case.
MT4 is a great platform, especially once you get to know its ways. Until there are compelling reasons to change – with no downsides – I have a feeling that MT4 will remain the most popular for some time.
Spread bets and CFDs are leveraged products. Spread betting and CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.This information has been prepared by IG, a trading name of IG Markets Limited. The material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Editors’ Picks
EUR/USD: Sellers attack 1.1700 as USD stages a solid comeback
EUR/USD attacks 1.1700 amid heavy selling interest in the European trading hours on Wednesday. A solid comeback staged by the US Dollar weighs heavily on the pair, as traders look to USD short covering ahead of US CPI on Thursday. However, the downside could be capped by hawkish ECB expectations.
GBP/USD slides toward 1.3300 after softer-than-expected UK inflation data
GBP/USD has come under intense selling pressure, eyeing 1.3300 in the European session on Wednesday. The UK annual headline and core CPI rose by 3.2% each, missing estimates of 3.5% and 3.4%, respectively, reaffirming dovish BoE expectations and smashing the Pound Sterling across the board.
Japanese Yen weakens ahead of BoJ meeting; USD/JPY retakes 155.00 amid USD uptick
The Japanese Yen extends its steady intraday descent against the recovering US Dollar, pushing the USD/JPY pair back above the 155.00 psychological mark during the Asian session. Any further JPY depreciation still seems elusive in the wake of the growing acceptance that the Bank of Japan will raise interest rates at the end of a two-day policy meeting on Friday.
Editors’ Picks
GBP/USD slides toward 1.3300 after softer-than-expected UK inflation data
GBP/USD has come under intense selling pressure, eyeing 1.3300 in the European session on Wednesday. The UK annual headline and core CPI rose by 3.2% each, missing estimates of 3.5% and 3.4%, respectively, reaffirming dovish BoE expectations and smashing the Pound Sterling across the board.
EUR/USD: Sellers attack 1.1700 as USD stages a solid comeback
EUR/USD attacks 1.1700 amid heavy selling interest in the European trading hours on Wednesday. A solid comeback staged by the US Dollar weighs heavily on the pair, as traders look to USD short covering ahead of US CPI on Thursday. However, the downside could be capped by hawkish ECB expectations.
Gold: Bulls await breakout through multi-day-old range amid Fed rate cut bets
Gold attracts fresh buyers during the Asian session on Wednesday, though it remains confined in a multi-day-old trading range amid mixed fundamental cues. The global risk sentiment remains on the defensive amid economic woes and fears of the AI bubble burst. Moreover, dovish US Federal Reserve expectations lend support to the non-yielding yellow metal, though a modest US Dollar uptick might cap any further appreciating move.
Bitcoin, Ethereum and Ripple extend correction as bearish momentum builds
Bitcoin, Ethereum, and Ripple remain under pressure as the broader market continues its corrective phase into midweek. The weak price action of these top three cryptocurrencies by market capitalization suggests a deeper correction, as momentum indicators are beginning to tilt bearish.
Ukraine-Russia in the spotlight once again
Since the start of the week, gold’s price has moved lower, but has yet to erase the gains made last week. In today’s report we intend to focus on the newest round of peace talks between Russia and Ukraine, whilst noting the release of the US Employment data later on day and end our report with an update in regards to the tensions brewing in Venezuela.
RECOMMENDED LESSONS
Making money in forex is easy if you know how the bankers trade!
I’m often mystified in my educational forex articles why so many traders struggle to make consistent money out of forex trading. The answer has more to do with what they don’t know than what they do know. After working in investment banks for 20 years many of which were as a Chief trader its second knowledge how to extract cash out of the market.
5 Forex News Events You Need To Know
In the fast moving world of currency markets where huge moves can seemingly come from nowhere, it is extremely important for new traders to learn about the various economic indicators and forex news events and releases that shape the markets. Indeed, quickly getting a handle on which data to look out for, what it means, and how to trade it can see new traders quickly become far more profitable and sets up the road to long term success.
Top 10 Chart Patterns Every Trader Should Know
Chart patterns are one of the most effective trading tools for a trader. They are pure price-action, and form on the basis of underlying buying and selling pressure. Chart patterns have a proven track-record, and traders use them to identify continuation or reversal signals, to open positions and identify price targets.
7 Ways to Avoid Forex Scams
The forex industry is recently seeing more and more scams. Here are 7 ways to avoid losing your money in such scams: Forex scams are becoming frequent. Michael Greenberg reports on luxurious expenses, including a submarine bought from the money taken from forex traders. Here’s another report of a forex fraud. So, how can we avoid falling in such forex scams?
What Are the 10 Fatal Mistakes Traders Make
Trading is exciting. Trading is hard. Trading is extremely hard. Some say that it takes more than 10,000 hours to master. Others believe that trading is the way to quick riches. They might be both wrong. What is important to know that no matter how experienced you are, mistakes will be part of the trading process.
The challenge: Timing the market and trader psychology
Successful trading often comes down to timing – entering and exiting trades at the right moments. Yet timing the market is notoriously difficult, largely because human psychology can derail even the best plans. Two powerful emotions in particular – fear and greed – tend to drive trading decisions off course.