Trading platforms are excellent tools for investment and spread betting, and MetaTrader 4 is one of the world's most popular. Find out why here.
Trading, whether you're focused on forex or spread betting, is complicated. You have to not only work out which trades are the most likely to make you a profit, but also deal with all the admin that comes with it. From dealing with a broker to monitoring the state of the market, these steps not only take up your time but can also cost you money.
A large part of successful trading is buying or selling at the right time. While stock markets generally only rise or fall in value by less than one percent each day, that could still make a significant difference depending on the trade you are making. Don't forget that stock prices could change on a second-by-second basis, affecting the value of your trade.
If you have to go through a broker, they will likely complete your trade within seconds. However, you have to factor in the time taken to call and get through to them, as well as the fact the state of the market may have changed since you decided to make the trade. All of these issues can be avoided by using a trading platform such as MetaTrader 4.
What is MetaTrader 4?
You can read more about MetaTrader 4 here, but the basics are that it is a trading platform. This is simply an application you can use to complete trades yourself without having to rely on a broker. Of course, there are plenty of other features to it, but those are the basics.
The advantages of this should be clear. Firstly, you can trade as and when you want to. There's no need to wait for a broker when you can trade yourself in seconds. This allows you to take advantage of small changes in the market as soon as they happen, reducing the number of missed opportunities.
Brokers also cost an average of $5 to $15 (around £4 to £12) per trade. Trading platforms allow you to trade on your own without having to pay this, although there may be other costs depending on the platform you choose. Brokers might also have personal biases for or against certain stocks or currencies that can affect the advice they give you and what they trade.
Then there is the ability to monitor investments in real time. Trading platforms are online, meaning you can make adjustments and close out trades as soon as it makes sense to do so. Without this information, it can be hard to make a solid return on your investments and spread bets.
MetaTrader 4 does all this and more, with a wide range of features. One thing to bear in mind is that it is a dedicated application, not an online app. This means it is something you can download, rather than needing to access it through your internet browser.
Advantages of MetaTrader 4
So, what can MetaTrader 4 do that other trading platforms can't? There are always going to be advantages and disadvantages to each app, but MetaTrader 4 is one of the most popular trading platforms in the world for a reason.
It allows you to trade CFDs with tight spreads - from as little as 0.0 pips - on over 200 instruments. You can trade on over 170 forex pairs, all the key indices, and even commodities like gold and silver.
MetaTrader 4 is also very flexible. There are no restrictions on many of the aspects of trading, such as minimum stop-loss or take-profit distances, or stop-loss and take-profit limits. This is great if you are making large volumes of trades, as it allows you to mitigate your losses and maximise the amount of profit you can make.
Other options
There are a range of other trading platforms available, many of which have similar features to MetaTrader 4. For example, there's MetaTrader 5, the next iteration of the application. While generally the newer version will be better, there are advantages and disadvantages to upgrading from MetaTrader 4.
While MetaTrader 5 is a bit faster and a lot more detailed - with more order types, timeframes and technical indicators - it is generally harder to use than MetaTrader 4. It is a more complex application, which is better suited for people who are already trading high volumes and complicated options.
Then there's cTrader, which is more focused on investments than currency and forex trades. It is again more complex, with a wide range of different options. Again, this is great if you're already involved in complicated trading. However, it has some disadvantages. While MetaTrader 4 lets you automate trading with Expert Advisors, which you can easily programme, cTrader only allows you to do this if you already know how to code in C#.
Ultimately, the trading platform you use will depend on your specific needs. However, using a platform in the first place is definitely something you should try out. MetaTrader 4 comes with a free demo account, so there's no reason to not give it a try and see if it is the trading platform for you.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when spread betting and/or trading CFDs. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
