MetaTrader 5, or MT5, is a platform launched by MetaQuotes in 2010 for trading financial products such as foreign exchange. Building on the experience gained from the MT4 platform, it optimizes performance while introducing improvements over its predecessor. As the foreign exchange industry evolves, MT5 is poised to become the mainstream foreign exchange trading system.
There are essentially two main reasons for this: the optimization of the MT5 platform and changes in the forex industry.
Optimization of the MT5 Platform
As an upgraded version of MT4, MT5 retains the strengths of its predecessor while optimizing certain trading operations and the user interface. For example, MT5 retains the fast backtesting feature and the ability to test multiple currencies simultaneously, and it also improves the customization of chart windows and the display of specific candlestick data.
Compared to MT4, at the trading operations level, MT5 supports various order execution policies and offers additional options for order execution. For example, in addition to the “fill or cancel” option, it includes “immediate or cancel” and “return.”
In addition, MT5 has expanded the range of pending order types and technical indicators, introduced a hedging feature, added support for transfers between accounts, and allows users to set market orders and pending orders with a single click.
In terms of the display panel, MT5 has added more types of chart objects and time frames and supports an economic calendar. In other areas, MT5 has introduced a chat feature to facilitate communication among clients, removed restrictions on tradable instruments, and expanded the range of supported markets beyond just the foreign exchange market. These are all features that the MT4 platform cannot offer.MetaQuotes drew on the experience gained from the MT4 platform and optimized the MT5 platform, enabling it to best meet client needs and cater to market demands.
Furthermore, MetaQuotes has made the programming for the MT5 platform simpler, making it more user-friendly.
In addition, the MT5 platform complies with U.S. regulatory laws, offers greater flexibility, and caters to a broader client base.
Changes in the Foreign Exchange Industry
In addition to the MT5 platform’s own optimizations, changes in the forex industry also suggest that MT5 will become the mainstream forex trading system. The forex industry is shifting toward a multi-asset model, and the MT5 platform’s features align with this trend. The use of MT5 will better meet the needs of the forex market, and forex brokers should be particularly aware of this.
The reason MT4 remains widely used today boils down to the fact that forex brokers face a period of adjustment when switching platforms; transitioning from a familiar platform to a new one inevitably involves unknown risks. However, the opportunity cost of continuing to use MT4—that is, forgoing the superior performance of the MT5 platform—is undoubtedly higher.
Although MT4 is a widely used market data platform and forex trading system that allows users to view market data for financial products such as forex, MetaQuotes announced in 2016—six years after the launch of MT5—that it would phase out MT4.The reason for this was precisely that MT4 could not adapt to the trend toward multi-asset retail trading; it was no longer capable of meeting the evolving demands of the industry in many trading operations, making its phase-out inevitable. Furthermore, as competition in the forex market intensified and spreads narrowed, the profits investors could earn also decreased; MT5, which offers multi-asset trading, is better positioned to retain clients.
Taking all of the above factors into account, we can conclude that MT5 will become the mainstream forex trading platform.
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