There are two common options that brokers offer when it comes to trading platforms. It’s either MetaTrader 4 or MetaTrader 5. These two trading platforms are considered as the standards of trading platforms because they have been around for a long time. If you are a Forex trader, most likely, the ideal trading platform for you is MetaTrader 4. If you are being offered MT5 as well and you are a Forex trader, preferably, you should choose the older version. The reason behind this is the fact that MT4 is designed for Forex trading. You can use its full potential if you are trading currencies. Meanwhile, if you venture to MetaTrader 5, you will see that there are a lot of rules that need to be followed. Also, not all trading strategies are easily applied. Nevertheless, these two trading platforms both have factors that contribute to their strengths and attract traders.
Comparing MetaTrader 4 And MetaTrader 5
MetaTrader has released two powerful trading platforms over the years. MetaTrader 4 and MetaTrader 5 are widely used by different kinds of traders according to the features that they need. There are differences between MT4 and MetaTrader 5 although they almost have the same name. More importantly, traders need to understand these differences so they can properly choose the trading platform that will perfectly suit their needs.
Limitations Of MT4 And MT5
No matter how powerful they are, MetaTrader 4 and MetaTrader 5 also have their set of limitations. There are limitations found in MetaTrader 5 that cannot be found in MetaTrader 4. Some of these limitations include the inability to hedge with the same trading account. Hedging a position means that you can trade the same currency pair but in the opposite direction. When you do the full hedge, you open two positions at the same time while partial hedging means that the volume of two opened positions is different.
This limitation is deemed positive for Forex traders because of the overall money management system. To say it plainly, hedging is something really risky, and avoiding it can benefit you in the long run especially if you are not very familiar with trading. Since Forex trading is already risky on its own, avoiding hedging can create a positive impact. In fact, there are regions around the world that don’t offer to hedge. An example of this is the United States.
Risk Aversion
By nature, Forex traders are people who love to take risks. But too much risk could ruin their trading account. As much as possible, you should limit taking risky strategies. If MT4 is allowed by the regulatory bodies to be used by clients, then most likely, Forex traders would love to use it on their trades. But these two trading platforms, the MetaTrader 4 and MetaTrader 5 have their own sets of positive features and limitations. If you are a Forex trader, MT4 is the most appropriate trading platform for you and is also perfect for your needs. But if you are venturing into the wider market, then you most likely need the more advanced features of MT5.
