Firstly, what is MetaTrader 4?
MetaTrader 4 may sound like a console game, but it has become established as one of the most widely used independent trading platforms for private traders and forex brokers around the world. While some forex brokers will offer their own proprietary trading platforms, MetaTrader 4, or MT4, has become established as the market leader for trading FX. MT4 was developed by software firm MetaQuotes, and first launched in 2005.
So what’s so good about MT4?
For starters, it is flexible. You can trade with MT4 on your computer, laptop, cellphone or tablet. Once you’re familiar with it, the features remain largely the same, regardless of which FX broker you are using. You won’t need to re-learn an entirely new platform. Oh, and it’s free.
Can I make use of Expert Advisors on MT4?
MT4’s prevalence in the FX trading market means that many programmers of algorithmic trading packages, or Expert Advisors, make use of it. Thus, if automated trading is your thing, more likely than not you’ll be using MT4. There is already a large library of free and commercial Expert Advisors available on the market for you to sift through.
Following other traders
Again, because use of MT4 is so widespread, many traders who broadcast signals to other traders, sometimes for a fee, will do so on MT4. The program has a signals feature that will allow you to follow other traders, seeing how they trade forex markets. It can be a great way for new MT4 traders to watch the experts in action.
Backtesting on MT4
Sometimes it can help to carry out back testing, particularly if you are using an automated program, and wish to see how it might perform over historical trading periods. The amount of historical forex data you have available to you will really depend on the MT4 broker you are using, although other free and reliable sources of FX data are available. Some FX brokers and databases can provide financial markets data all the way back the 1970s.
But what about MetaTrader 5?
MT5 is obviously the successor to MT4, and was launched in 2010, but is still not as widespread as its older brother. MT5 is gradually being rolled out to brokers, so you may find many brokers still offering just MT4 to traders. Specialist forex brokers are now more likely to be using MT5. Generally speaking, MT5 has more sophisticated features – e.g. a wider range of timeframe analyses for which to view markets with – but some traders still prefer MT4 because of its simpler user interface. It is likely that MT5 will eventually replace MT4 completely.
Is MT4 just for forex or can I use it for other markets?
MT4 was designed as a trading package for forex markers, and the vast majority of FX brokers will offer it. Some brokers will offer CFD trading on other markets like indexes through the platform, but this is not what it was designed for. MT5 has been designed to work with commodities and equities, reflecting a demand by traders who want a more multi-asset class system.
In summary, if you are seriously considering trading FX, then MT4 or MT5 will likely be the trading platforms you will be using. Luckily they are free, and it is possible to set them up on a computer and familiarise yourself with their functions without risking any money. Many MT4 brokers will also be able to advise you on installation and any technical problems that may arise.
Choose your Metatrader 4 broker
Check out our reviews of each of these brokers by following the links.