MetaTrader 4, or MT4, is an online electronic trading platform that prioritizes margin trading. It was released for the financial market in 2005 by MetaQuotes, a Russian software developer. After obtaining an MT4 license exchange, Forex brokers can provide this software to traders. Thus, their clients get access to a wide range of markets and a chance to trade in a conveniently intuitive mode.
MetaTrader 4 is a single-threaded platform for a 32-bit OS. Nevertheless, it was made with consideration of different clients. Thus, Mac OS users can install MT4 Wine application, a free software allowing Unix-like systems to work with applications created for Microsoft Windows systems.
The success and popularity of MetaTrader 4 are mainly explained by simplicity and clarity for brokers and traders. Another reason for its extensive approval is that end-users can automate trading. Scripts and robots for traders can be developed using the MSQ4 programming language. Also, brokers can augment the platform with ready-made plugins and extensions, which help them work with risk management, attract customers, etc.
Structure of MetaTrader 4
In global MT4 contains two parts:
- Server component. Brokers use this service to do their regular work to manage accounts, transmit quotes, and process trades.
- Client component. It allows traders to work with orders, while remaining aware of prices and charts, managing their accounts, and accomplishing other work tasks.
Specifically, the platform is composed of:
- Server, which has no interface and functions only as a Windows service. It processes user requests, informs about news and quote changes, keeps archives and reports.
- An MT4 Administrator application is developed for the remote control of the Server. It can conduct insignificant operations with Metaquotes’ client accounts. Thus, brokers or main labels can customize basic parameters via the MT4 Administrator.
- Data Center is a proxy server created to increase the scalability and security of the platform.
- Web-platform is used to trade via a browser, supporting all standard functions.
- The MT4 Manager application serves to process trade requests and manage clients accounts. White Label brokers only have access to the MT4 Manager application, and not to the MT4 Administrator application.
- The Client Terminal is installed on a client’s computer to trade and conduct technical analysis in a real-time mode.
- Mobile apps help to manage trading accounts remotely on mobile devices.
Thus, the broker can utilize the platform to offer three versions of a working zone to his clients: a web-platform, mobile apps, and a client terminal.
Brief History of MT4 in Forex
MetaQuotes entered the market with its first software program in 2002. After several inconsequential versions for users, in 2005 the company introduced MetaTrader 4 to the market.
Between 2007 and 2010, MT4 became a very popular platform among traders. At the same time, brokers augment the existing software with new advisors and scripts.
Although in 2013 the newcomer MetaTrader 5 was released by MetaQuotes, many users stayed with MT4, because they were already used to it, while MT5’s new features required some getting used to. At the same time, the company had stopped selling licenses for MT4 after MT5 was released.
Functionality of MetaTrader 4 in Forex
Brokers working with MT4 can perform all necessary brokerage services, such as:
- trade processing,
- account management,
- transmitting brokers’ quotes.
Moreover, MT4 has other important features for brokerages to make their clients’ workspace reliable, such as:
- an effective security system,
- data recovery functions,
For this reason, MetaQuotes encrypts information to exchange it between the platform services and the client terminal by adding RSA digital signatures, a public-key cryptosystem.
Pros of MetaTrader 4
- The multi-language interface supports more than 30 languages, including English, German, Russian, French, German. Brokers all over the world can work in their own native languages.
- Top transaction security. MetaQuotes uses a 128-bit security key to provide brokers and traders with a highly secure working environment and to protect their data and personal information from hackers’ attacks.
- The interface reflects UX design user-friendliness requirements.
- Integral communication tool. It allows brokers not only to send messages to traders in real-time, but gives traders a chance to discuss strategies, order development of indicators, etc.
- The client component is compatible with different operating systems: iOS, Android, Windows, Linux, and Mac OS. The server component works with Windows only.
- MT4 works quickly with no overloads that allows MetaQuotes’ clients to react faster to all market changes.
Cons of MetaTrader 4
- Brokers are unable to purchase the Metatrader 4 trading platform licenses any more. Only MT5 has conceptual updates, while MT4 does not.
- No support of exchange-traded futures.
- No support of market depth.
- Limitations of 32-bit architecture.