Forex & CFD trading is not the same as it was ten years ago. Trading platforms surfaced in the late 1990s. Back then, we could see various developers producing very special software for trading. Those were trading platforms, or the so-called trading terminals. They paved the way to the growing popularity of retail trading and offered many people access to financial Forex & CFD trading.
Lately, trading platforms have started to offer trading on cryptocurrencies. Bitcoin, Ethereum, Ripple are some of the most popular instruments in the world of evolving cryptos.
Trading platforms are trader's workspace. That is where you will be spending most of your trading days. It is vital to connect a trader both with a broker's server and to provide access to different CFD and financial markets.
By doing that they provide different trading instruments. You are able to trade Forex, as well as CFDs on cryptocurrencies, indexes, shares, bonds, and commodities. The main features of MT4 are mobility, security, mobility, and multifunctionality.
MT4 is a mobile platform. By saying that, we refer to trading not only on the computer, but also on smartphones and tablets. MT4 is implemented as form of three different types: desktop, mobile, and browser. Both mobile ( iOS, Android) and web platform is fully compatible with the desktop terminal.
If you open an order on your computer, you can easily manage it from your tablet via the mobile version for Android/iOS devices. All data will be displayed correctly. The main point with the browser and mobile platform is that you are time and place independent. You are always able to check the account or opt to close an order at any time from any device that is connected to the Internet.
MetaQuotes Software Corp has implemented many different functions for trading Forex & CFD instruments. MT4 offers the different trading and analytical technologies, and also additional useful services. It has a lot to offer for Forex & CFD trading.
One of the strengths of MT4 is algorithmic trading. It means trading with the help of automated trading systems. Expert Advisors (EA) trade at a predetermined algorithm. The MQL4 IDE is built in the platform, which allows you to create a personal advisor or robot of any complexity.
Most new traders are not familiar with MQL4, but can use the built-in app store MetaTrader Market and a free library Code Base. There, you will find everything you might need for efficient trading – a variety of different technical indicators, scripts, and EAs.
On MT4, the exchange of information between you, the terminal, and the platform servers is encrypted with 128-bit keys. The platform also supports an enhanced security system based on RSA – an asymmetric encryption algorithm.
As you probably know, the industry is slowly but steadily shifting towards MT5. In my opinion, MT5 is the future of retail trading. Let's find out what's special about this new, re-vamped platform!
This is just a small list of the cool features the new MT5 has. It is very hard to focus on them all as the list is very long. Have a look at the webinar we hosted about the new exciting features of MT5:
One of the major benefits of the MT5 platform is that traders are not restricted to using only the built-in analytical resources, such as MT5 tables, indicators, and graphs. Owing to MQL5, an object-oriented and a high-performance programming language, traders are able to create their own technical indicators.
The coding should be much simpler than MQ4, so that traders can even create trading robots, or Expert Advisors (EA). Trading robots (EAs) are able to automatically implement different trading strategies based on a number of different inputs. That way, traders will have the ability to access very accurate market analysis and forecasts.
Starting with the Beta Build 1281, MT5 allowed hedging that was only possible with MT4. Unlike the standard netting system, hedging allows to conduct multiple trades even in the opposite direction of the same symbol. Now, traders can use the netting model to trade exchange instruments and hedging for currency trading using the MetaTrader 5 institutional platform. However, MetaTrader 5 offers enhanced order management capabilities, e.g., filling orders using multiple deals, including partial fills.
If a trader has an open position at a symbol and performs a new deal, a new position is opened. That is the core idea behind the MetaTrader 5 hedging system. The trader can set Stop-Loss and Take-Profit levels as well as see the profit level for each position. In my opinion, this was an absolute must for all who traded using different hedging strategies.
However, MetaTrader 5 offers enhanced order management capabilities: filling orders using multiple deals, including partial fills. If a trader has an open position at a symbol and performs a new deal, a new position is opened. That is the core idea behind the MetaTrader 5 hedging system.
Keep in mind that MetaTrader 5 is a multimarket platform, which means that you can trade both in centralised and non-centralised markets.
MT5 allows to get real volume-traded data, not only tick volume data. The tick volume means the number of price changes that have occurred in the course of the bar and nothing more than that. With MT4, you simply do not know the real volume (contracts, or lots) that have been traded.
In MT5, you can download and consult tick history from your broker. In MT4, you can only save tick data manually, which brings about many limitations. You must have your platform turned on 24 hours a day, and still… you'll never keep all the ticks. In MT4, you can never know what the most traded price or cluster in the selected range was. You have to make an estimation using only M1 bars which is a drawback compared to the real tick history of the broker, especially if you do backtesting.
Why is this important? Simply because there are many traders who use tools like Market Profile, Delta Volume, and other tools, i.e., real POC/ VWAP/ Profile levels.
A few of my personal favourites include easy Ladder Trading and expanded Mini Terminal available through MT5SE. These tools are very important to scalpers and news traders as you can do trading in just a few clicks.
This tool allows for an unpreceded accuracy in opening and managing positions quickly. Traders are able to open both pending and market orders with the use of a new order ladder. The risk and reward for orders will be calculated on the fly and are super easy for you to set up, believe me. For example, to open a pending buy order, you can simply click on the blue ladder at the requested price, move the mouse up for take-profit and down for stop-loss, and to open a market order, just hold the SHIFT button on your keyboard and hover your mouse on the ladder. Easy, right?
Source: DAX30, M15 Chart, Admiral Markets MT5SE
With the new MT5SE, you are able to expand the Mini Terminal into a fully-featured control panel for your whole account with a simple click of a button. That way, you should be able to open and manage orders more easily as well as receive important information about your selected trading symbol.
Source: DAX30, M15 Chart, Admiral Markets MT5SE
As mentioned above, it is very hard to count all the advantages of the MT5 platform.
MT5 is faster than MT4. It doesn't slow your platform and so far, I haven't noticed any hiccups or freezes. It is a fully fledged 64-bit, multi-threaded platform, whilst MT4 is a 32-bit, mono-threaded platform with a 2GB (or 4GB memory limit if you use it on a 64-bit operating system). In my experience, I have seen the speed increase of almost 100 times when I did the backtesting.
According to the
source, MT5 being the latest version of the software runs excellent on 64-bit operating systems whereas MT4 is ideal for 32-bit operating system. You will need the set-up execution file to install the software. It is important to note that MT5 can run on the 32-bit operating systems, too.
However, when it comes to running MT4 on 64-bit systems you will notice that it does not work as fast as on 32-bit systems. It's not always the case, but if you use MT4 on a VPS server with multiple CPU cores, it will not work efficiently.
MT4 and MT5 have different server built-ups. MT4 has only one dedicated server that is restricted in its communication with other servers. MT5, on the other hand, deploys jobs to other servers and they work together giving synergy and are able to achieve hardware utility as well as improving results because of the different servers communicating and working together leading to resource optimisation. There are four main servers that MT5 uses: access server, trade server, history server, and backup server. This is unlike MT4 that uses only one server engine.
On the MT4 platform, reports that you can pull from the software are only in the HTML format. With MT5, the reports are both in the HTML and Open XML table format. See images below.
Source: Admiral Markets MT5SE Platform, USD/JPY M15 Chart
MT4 is still straightforward and simple. It has about 30 in-built indicators and 33 analytical objects. It allows for two types of market orders, four types of pending orders, two different execution modes, two stop orders, and a function of trailing stop. It is still easy to navigate through it and many traders simply love to use it.
MT5 has 38 in-built indicators. It offers a separate economic calendar tab with features like news event, schedule, impact, forecast, previous, etc. It offers 6 types of pending orders, DOM access (Depth of Market), and data on time and sales from the exchange.
The number of analytical objects that help identify financial instrument price trends is limited to 31 on MT4 and is 44 on MT5. Those objects may detect cycles and support/resistance levels, build channels, and more.
We can also spot a difference in log files. On MT5, log files are automatically compressed, whereas with MT4, it is not the case. On MT5, you can get codes from the code base as compressed zipped folders are available on the MT5 platform, and you can store them on your local drive.
MT5 allows for partial orders, if, for instance, the maximum volume of a trade is met and the trade is not filled, traders can select partial edit to allow for the remaining volume to be cancelled.
The industry is advancing, evolving, and moving towards MT5. According to Anthony Papaevagorou, Head of Sales at MetaQuotes, as said at the Finance Magnates London Summit, the focus has been fully shifted to MT5.