Pepperstone MT5 | ECN Trading Platform | Review

Pepperstone MT5 | ECN Trading Platform | Review

Pepperstone MT5 Trading
Online BrokerMinimum DepositOnline Trading PlatformMarketsRegulation
$200MT595+FCA, ASIC

Pepperstone MT5 Trading - ECN Platform - Automated Trading - Review

ECN CFD broker Pepperstone has added the MetaTrader 5 (MT5) online trading platform to its range of platforms, joining MT4 and cTrader.

What is MT5 ?

MT5 is MetaQuotes's successor to MT4. MT5 is optimised for ECN trading and has a number of improvements on MT4, including more technical indicators and time frames available as standard and a built in economic calendar. Traders can program automated trading strategies in MQL5, which is an object oriented programming language.

What are Pepperstone's commission charges on MT5 ?

The commission charges are the same as MT4, which is $3.50 or AU$ per lot per side (AU$/$7 round turn) or £2.29 per lot per side (£4.59 round turn).

Pepperstone MT5 review

Pepperstone MT5 contains 95+ markets (like MT4) covering Forex, Precious Metals, Hard Commodities (Copper), Indices, Energy, Futures (US Dollar Indices Futures), Soft Commodities (Agriculturals) and Cryptocurrencies, offered as CFDs. There are 38 technical indicators supplied as standard on the platform. MT4 has 30 supplied as standard, but there may be more at a given broker (including Pepperstone, which has 85+). Also, more indicators can be added which have been designed by other traders and participants. The trader can program their own indicators or modify them. There are 21 time frames (with increased granularity in minute time frames), again an increase from MT4's offering and more graphical objects. An economic calendar is supplied, unlike MT4. There is also a range of improvement in order types and policies, including allowing partial order filling. It is possible to hedge positions (though this is also possible with MT4).

While MT5 can be used as a discretionary trading platform, that is trading where the trader makes their own decision based on charting analysis or other factors, it is designed as well for automated trading. Automated trading allows the trader to take a trading strategy (such as a set of rules based on an indicator to enter, manage and exit a trade) and apply it as a program to make trading decisions on their behalf. One advantage of doing this, is that a computer program does not get tired or allow emotions to cloud its judgement, rather will execute the rules dispassionately until the program is stopped. If the trader trades while connected to the broker, there may be potential issues with connectivity. Thus the trader can use a Virtual Private Server (VPS) which hosts the programs 24/7, at a cost. These can be ordered through Pepperstone.

However automated trading is not a panacea, it is a tool. The very fact that a computer program will execute programs according to the rules, means that it cannot exercise discretion like a human trader. This can result in large drawdown or losses. There are ways to combat this including adjusting the rules (i.e. adding back the human element of discretion). It is typical to backtest a strategy against past market data. One issue with this is that because a strategy performed well in the past, does not means it will work when actually applied to the real market.

Pepperstone is an ECN broker. This means that it uses technology to deliver high speed order execution and aggregates prices from liquidity providers. It also says it has a commitment never to intervene in the order process, making it a no dealing desk broker and will allow trading styles such as scalping and news trading. MT5 provides market depth as standard. This is found under View -> Depth of Market on the trading platform. Depth of market shows the bid and offer prices available according to the volume being traded, for a given market.

Pepperstone is regulated by both the Financial Conduct Authority (FCA) in the United Kingdom and the Australian Securities and Investments Commission (ASIC) in Australia. Which Pepperstone the trader will trade with depends on their location. While the FCA regulated Pepperstone has lower maximum leverage, it does provide negative balance protection. Pepperstone's ECN Razor Account can have very low spreads on liquid Forex pairs. However there is also a competitive commission charge added, so the total price is the spread plus the commission charge. There is a Standard account for trader who wish to trade using STP without a commission charge. There is additionally an Islamic account available.

What is the minimum deposit to trade on MT5 at Pepperstone ?

The minimum deposit is $200 or AU$200 or £100.

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