The Lesser-Known Benefits of MetaTrader 5 for Businesses

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Along with MetaTrader 4, MetaTrader 5 (MT5) is MetaQuotes’ most popular charting software. While we often associate this software more with traders, it provides some lesser-known yet valuable perks for businesses. Whether it’s a brokerage, a hedge fund, or another financial institution, MetaTrader 5 has something for enterprise in traded markets.

Which Businesses Can Benefit From MetaTrader 5?

MetaTrader 5 is a trading platform offering access to numerous financial markets. Hence, the businesses that need the service are primarily financial institutions.

Brokers

Brokers are the main beneficiaries of MT5. These are derivatives providers that allow clients to speculate in assets like forex, crypto, indices, metals, and stocks. 

The companies pay MetaQuotes a set monthly cost for one of three licenses that offer a different number of servers, terminals, accounts, and gateways. They can then provide their customers free access to the software and charge trading fees for every position they execute in the markets. 

Prop Firms

This is a fast-growing industry, particularly within forex and futures trading. A prop firm is a company that offers traders access to its capital in return for a predetermined split of the profits generated.

The company puts prospective ‘fund managers’ through an evaluation process on a demo account before they trade on a real account. Prop firms often use MT5 for both accounts linked to a specific broker. They profit chiefly from challenge fees that traders pay during the assessment stage and the gains they generate.

Hedge Funds

Hedge funds use platforms like MT5 for backtesting and algorithmic trading purposes. While the trading platform is considered technically inferior to others, its licensing fees are cheaper. This lowers the barrier to entry for prospective businesses in this field.

Hedge funds will have their MT5 accounts connected to a broker and profit from management and performance fees they charge clients.

The Main Benefits for Businesses Who Use MetaTrader 5

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Now that you know the different businesses that appeal to MT5, let’s examine the benefits they can derive from the platform.

Trading Data

The first obvious advantage is the substantial real-time and historical data on MT5. This is thanks to the platform’s integration with an ever-growing number of brokers and exchanges.

This data resource serves many purposes. For starters, businesses can rely on this information for speculative reasons if they employ or have traders who trade for them. Secondly, it helps to stay abreast of price-related and economic developments for numerous traded markets.

White Labelling

White labeling refers to the practice of one company using the infrastructure of another and rebranding it as its own. Given the much lower investment than developing the same service from scratch, it’s an increasingly popular and quicker method for starting a brokerage or prop firm.

MetaQuotes has partnerships with many third-party financial institutions that specialize in white labeling. Business owners can rebrand MetaTrader 5 to match their brand and needs while providing the same top experience clients expect.

Algorithmic Trading

MT5 is revered for its powerful yet accessible algorithmic trading features. With an in-house trading desk, these can benefit hedge funds, brokers, and other financial institutions. MT5 allows businesses to create, customize, and test their own ‘robots’ or use countless pre-existing ones.

While the software uses the proprietary MQL5 language, it supports other programming languages like R and Python.

Fund Management

This point relates primarily to hedge funds. MT5 offers these businesses an in-depth look into their fund performance through regularly updated parameters like maximum capitalization, share values, net asset value, etc. 

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Hedge funds are able to manage operation balances, commissions, and payouts. They can even create separate accounts for employees and investors with different access levels, setting up a specific fund distribution and individual profit levels.

Gateways for Connection to Exchanges and Liquidity Providers

Brokers generally handle orders traded by their clients internally or ‘over the counter’ without any connection to an exchange. Fortunately, MetaTrader 5 can allow brokers to integrate with global exchanges through special gateways.

These integrable solutions enable brokers to hedge their risk “associated with clients’ operational risks (STP) through an interaction with other MetaTrader 5 brokers,” according to MetaQuotes.

At the time of writing, MT5 offers gateways to the following exchanges:

  • Moscow Exchange
  • Dubai Gold and Commodities Exchange
  • Borsa Istanbul (BIST)
  • Pakistan Mercantile Exchange 
  • Chicago Mercantile Exchange
  • Hong Kong Stock Exchange
  • Tel Aviv Stock Exchange
  • Tokyo Stock Exchange
  • NASDAQ
  • New York Stock Exchange
  • London Stock Exchange

Besides exchanges, MetaTrader 5 also supports gateways to liquidity providers. Like exchanges, traders see the latter as a more transparent way of trading compared to the internal approach mentioned earlier.

Presently, the software provides gateway connectivity to these liquidity providers:

  • Integral
  • Cboe FX
  • Euronext FX
  • Currenex
  • FXCM Pro
  • LMAX Global
  • Swissquote
  • Alpari

MT5 Is a Full-Cycle Platform for Brokerage Businesses

All in all, MT5 stands tall for any business in the brokerage industry to begin and maintain their ventures without needing additional software. The software appeals to brokers, prop firms, and hedge funds. These companies can benefit from its huge data resource, convenient white labeling, algorithmic trading, and access to top-tier exchanges and liquidity providers. The best part is the familiarity MT5 has with millions of traders globally.

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