When entering the forex trading field, MT4 (MetaTrader 4) and MT5 (MetaTrader 5) are two names that no trader can avoid. Developed by MetaQuotes, these forex trading platforms account for over 80% of global trading volume. But many mistakenly believe MT5 is just a simple upgrade of MT4. In reality, they have fundamental differences in market positioning, order mechanisms, and performance architecture. This article will deeply analyze the differences between MT4 and MT5, from core functionality to practical scenarios, helping you make precise choices.

I. Basic Understanding: What Exactly Are MT4 and MT5?

1. MT4 (MetaTrader 4): The Legend of Retail Forex Market

Launched in 2005, MT4 is a trading platform specifically designed for forex and CFDs. Its core capabilities focus on three modules:

• Market Analysis: 30+ technical indicators, 9 timeframes, custom charting tools
• Order Execution: Supports market orders, pending orders, and unique hedging mode (simultaneous long/short positions)
• Automated Trading: Develop Expert Advisor (EA) systems using MQL4 language

Irreplaceable Advantages:

Massive free indicators/EA resources, minimalist interface, and full broker support make it the preferred platform for forex beginners.

2. MT5 (MetaTrader 5): The Future of Multi-Asset Trading Terminal

MetaQuotes launched MT5 in 2010, targeting full asset coverage including stocks, futures, options, and forex. MT5's forex module fully retains all MT4 functionality while adding smaller quote units (down to 0.00001) and cross-asset correlation analysis tools. Breakthrough upgrades include:

• Asset Expansion: Native support for exchange securities and derivatives
• Technical Tools: 38+ built-in indicators, 21 timeframes (including 1-minute charts), Depth of Market (DOM)
• Performance Leap: 64-bit multithreaded architecture, 300%+ EA backtesting speed improvement
• Ecosystem Integration: Built-in economic calendar, news feed, and MQL5 community market

▶️ Key Positioning Difference: MT4 focuses on forex efficiency, MT5 builds a multi-asset trading ecosystem.

II. MT4 vs MT5: 6-Dimension Comprehensive Comparison

1. Market Positioning & Asset Support

	MT4	MT5
Positioning	Optimized for Forex/Precious Metals CFDs	Multi-Asset Integrated Platform
Assets	Currency Pairs, Gold, Oil CFDs	Forex, Stocks, Futures, Options, Crypto CFDs & Commodities

User Impact:

• MT5 is essentially a superset of MT4's forex capabilities
• But some brokers restrict MT5 forex features (e.g., disabling hedging) - verify in advance

2. Fundamental Order System Differences

Mode	MT4	MT5
Default Mechanism	Hedging Mode	Netting Mode (merges positions)
Order Types	6 types (4 pending)	8 types (6 pending, adds stop limit)

⚠️ Real Trading Risk Alert: In MT5 Netting Mode:

• Cannot set separate stop losses for long/short positions
• Hedging strategies require broker to enable hedging
• Even with hedging enabled, some brokers restrict it to futures/stocks only

3. Technical Analysis Capability Upgrade

Feature	MT4	MT5
Timeframes	9	21 (including seconds)
Indicators	30+	38+ (adds Dynamic ZigZag etc.)
Unique Tools	-	Depth of Market, Economic Calendar

✅ Practical Value:

• Scalping & HFT: 1-minute charts + DOM for precise entry
• Event-Driven Strategies: Calendar integration improves signal accuracy

4. Automated Trading (EA) Performance Revolution

Dimension	MT4	MT5	Performance Impact
Data Support	M1+ timeframes only	Native tick data backtesting	200x+ precision
Backtesting Engine	Single-threaded	Multithreaded (>75% core utilization)	Complex strategy efficiency
Memory Management	2GB limit	Dynamic allocation	Handles 10-year tick data

💡 Key Conclusions

• M1 Data Backtest: MT5 2.5-3.5x faster than MT4
• Tick-Level Backtest: MT5 exclusive, MT4 plugins unstable
• Complex Optimization: MT5 excels (5-10x faster parameter scans)

5. System Architecture & Stability

Architecture	MT4	MT5
Core Design	32-bit single-thread	64-bit multithread
Memory Control	2GB hard limit	No strict limit
Multitasking	Prone to crashes	Stable parallel processing

Professional scenario verification when running 3 EAs + 20 charts:

• MT4 crash probability: 68%
• MT5 crash probability: <5%

6. Resource Ecosystem & Migration Costs

Dimension	MT4	MT5
EA/Indicators	1M+ (mostly free)	200K+ (premium paid)
Community Support	Global forum coverage	MQL5 official market
Compatibility	-	Cannot run MT4 EAs/indicators

⚠️ Migration Reality: Converting MQL4 code to MQL5:

• Simple EA: 3-5 hours rewrite
• Complex grid EA: Weeks of重构

III. Decision Guide: How To Choose?

Choose MT4 When:

1. Trade Forex/Gold Only + Need Hedging: Verify broker's MT5 hedging status

2. Limited Budget + Free EAs Needed: Basic strategies like MACD crossover

3. Low Computer Specs: e.g. 4GB RAM older PC

Upgrade to MT5 When:

1. Trade Stocks/Futures/Options: MT5 has lower spreads for exchange products

2. Develop Complex Algorithms: HFT, AI models need multithreading

3. Require Precise Backtesting: Economic calendar + tick data exclusive to MT5

4. Institutional Management (PAMM/MAM): Native multi-account support

Contested Scenario Solutions

User Profile	Recommended Platform	Key Reason
Forex Beginner	MT4	Easier learning curve
US Stock/Futures Trader	MT5	Native exchange access
Hedging Strategist	Verify First	Confirm broker MT5 hedging
Quant Researcher	MT5	Backtest效率提升
Manual Trader (Multi-screen)	MT5	50%+ chart stability boost

IV. Industry Truths You Can't Ignore

• Broker Permissions > Platform Features
  • MT5 hedging/stock data requires broker enablement
  • Must verify: Broker supports needed functions
• Data Source Differences Exist
  • Same broker: EURUSD spread often 0.3-0.5 pips lower on MT5
• Compliance Migration Accelerates
  • EU/UK brokers stopped offering MT4 to new clients
  • Industry trend: MetaQuotes pushing MT5 migration

Conclusion: Matching Needs & Technology

MT4's Core Value lies in ultimate efficiency and mature ecosystem for forex, while MT5 represents the future of multi-asset integration and performance revolution.

1. Platform Core Definitions

MT4: Classic platform focused on forex & precious metals CFDs, industry benchmark for 15 years with hedging + free resources.

MT5: Advanced platform supporting forex, stocks, futures, options, defining the future with 64-bit multithreading + tick-level backtesting.

2. Three Key Differences

Dimension	MT4	MT5
Asset Scope	Forex/Gold/Oil	Forex+Stocks/Futures/Options
Order Mode	Supports hedging	Netting by default
Performance Limit	32-bit/single-thread	64-bit/multithread

3. Your Choice Depends On

✅ Choose MT4: Forex-only trading, need hedging, want free EAs, low-spec computer

✅ Choose MT5: Trade stocks/futures, develop complex EAs, need precise backtesting, seek peak performance

Ultimate Decision Formula:

• Forex + Hedging + Low Cost → MT4
• Multi-Asset + Algorithms + High Performance → MT5

Platforms are tools - consistent profitability comes from market knowledge & risk management