MetaTrader 5 (MT5) is an electronic trading platform developed by MetaQuotes, a software company, and released in 2010. Brokers license the platform and offer it to their clients, who use it to view prices and charts, place and manage orders, and run automated trading programs. It is the successor to MetaTrader 4, released in 2005, and the two together are the most widely used platforms in retail foreign exchange and contract for difference trading.
The platform is a product, not a market or a broker. A trader's orders go to whichever broker supplied the account, and the prices, instruments, leverage and execution quality all depend on that broker. MT5 is available as a desktop program, a web version and mobile applications.
Main features
- Markets. MT4 was designed for forex. MT5 was built to handle exchange-traded instruments as well, including shares and futures, where the broker offers them.
- Orders. The platform supports a market order, pending limit and stop orders, and a combined stop-limit order, with stop-loss and take-profit levels attached to positions.
- Charts and indicators. It offers 21 timeframes, from one minute to one month, and a library of built-in tools for technical analysis.
- Market depth. A depth-of-market window shows the bids and offers at each price where the broker supplies that data.
- Account modes. In netting mode, all trades in an instrument are combined into one position, as on an exchange. In hedging mode, which matches how MT4 works, separate long and short positions in the same instrument can be held at once.
Automated trading and MQL5
The feature that sets the MetaTrader family apart for automated trading is its built-in programming language. MT5 uses MQL5, an object-oriented language with a syntax close to C++. Programs written in it are of three main kinds: Expert Advisors, which can place and manage trades without intervention; custom indicators, which draw calculated values on a chart; and scripts, which run once to perform a task. An Expert Advisor is attached to a chart and reacts to each new price update, or tick, from the broker.
The platform includes a Strategy Tester for backtesting Expert Advisors on historical data. It can test strategies that trade several instruments at once, model execution on tick data, and run many parameter combinations in parallel across processor cores or a network of computers. MetaQuotes also publishes a module that lets programs written in Python request data from the terminal and send orders to it. Programs written in MQL4 for the older platform do not run on MT5 without being rewritten, which slowed the move of users from MT4.
How brokers use it
A broker runs the MetaTrader server software, sets up the instruments and trading conditions, and connects the server to its own dealing systems or to outside liquidity providers. Clients download the terminal and log in to that broker's server. Smaller brokers often rent the platform from a larger licence holder under what is called a white-label arrangement. Because the same terminal is offered by hundreds of brokers, a trader can change broker without learning a new interface or rewriting automated strategies.
The platform is aimed at retail trading. Professional firms that trade on exchanges generally use other systems, with direct exchange connections and their own software. Some retail traders use charting services such as TradingView, with its Pine Script language, alongside or instead of MetaTrader.
Limits and risks
The quality of a backtest in the Strategy Tester depends on the historical data, and each broker's price history differs. Results obtained on one broker's data may not carry over to another, and spreads, slippage and swap charges in live trading can differ from those assumed in a test. Optimising many parameters in the tester makes overfitting easy, and a strategy tuned to past data often fails afterwards.
A large market exists in Expert Advisors and trading signals sold to retail users, including through a marketplace operated by MetaQuotes. Past performance shown for such products is frequently a backtest or a short live record, and regulators in several countries have warned about misleading claims attached to automated trading systems. The platform itself does not make an unregulated broker safe: the software has been used by licensed firms and by fraudulent operations alike, and the protections available to a client depend on where and how the broker is regulated. Most retail accounts trading leveraged forex and CFD products lose money, a fact that brokers in the European Union and the United Kingdom are required to disclose.