This is not investment advice. The information provided is for educational and informational purposes only and does not constitute a recommendation to buy or sell any financial product.
MetaTrader (MT4 and MT5) is a trading platform that was originally designed for forex trading, and it has been adapted for stock trading through brokers that offer stock CFDs, single-stock futures, or direct stock access. The platform is popular among day traders because of the speed, the charting, the automated trading, and the custom indicators.
Using MetaTrader for day trading stocks requires a broker that offers stock CFDs or stock futures on the MetaTrader platform. The trader opens an account at the broker, downloads the MetaTrader platform, and connects the platform to the broker's server. The trader can then place orders, monitor the positions, and analyse the market from the MetaTrader interface.
The MetaTrader features for day trading
The charting is the most important feature. MetaTrader offers multiple time frames (1-minute, 5-minute, 15-minute, 1-hour, 4-hour, daily, weekly, monthly), multiple chart types (bar, candlestick, line), and a large library of built-in indicators (moving averages, RSI, MACD, Bollinger Bands, Fibonacci, Ichimoku). The trader can also install custom indicators that are shared by the MetaTrader community.
The one-click trading is the second most important feature. MetaTrader allows the trader to place a trade with a single click from the chart or from the Market Watch window. The trader sets the order size, the order type, the stop loss, and the take profit in advance, and the trader clicks once to execute the trade.
The automated trading (the Expert Advisors, or EAs) is the third most important feature. MetaTrader allows the trader to write or install automated trading scripts that place and manage the trades according to a predefined strategy. The EA can be used for a day trading strategy that is systematic and rules-based.
The setup for day trading
The trader should set up the MetaTrader platform with the charting layout that matches the trading strategy. A day trader who trades a single stock should have the 1-minute chart open for the entry and exit, the 5-minute chart for the trend, and the 15-minute chart for the support and resistance levels. The trader should also have the Market Watch window open for the real-time prices and the Trade window open for the position management.
The trader should also set up the hotkeys and the quick trading buttons for the one-click execution. The MetaTrader platform supports keyboard shortcuts for the order types, and the day trader should customise the shortcuts for the personal trading style.
The trader should also set up the alerts. MetaTrader supports price alerts (when the price reaches a specified level), indicator alerts (when an indicator produces a signal), and time alerts (when a specified time is reached). The alerts ensure that the trader does not miss a trading opportunity or a risk event while away from the desk.
The limitations of MetaTrader for day trading stocks
The main limitation is that MetaTrader is not a direct stock trading platform. The platform is designed for forex and CFD trading, and the stock trading through MetaTrader is limited to the products the broker offers. The broker may offer only a subset of stocks, and the broker may not offer the stock exchanges the trader needs.
The second limitation is the data feed. MetaTrader displays the data from the broker's server, and the data may be delayed or aggregated. A day trader who needs real-time data from the exchange (Level 2 data, the order book depth) cannot get it from MetaTrader.
The third limitation is the order types. MetaTrader supports the standard order types (market, limit, stop, stop limit, trailing stop), and the platform does not support the advanced order types (OCO, OTO, bracket orders) that are common on stock trading platforms.
The brokers that offer MetaTrader for stocks
The most common approach is to use a broker that offers stock CFDs on MetaTrader. The broker offers the stock as a CFD, the trader takes a leveraged position on the stock's price, and the trader does not own the stock. The advantage is the leverage and the simplicity; the disadvantage is the broker's risk and the financing cost.
The alternative is a broker that offers single-stock futures on MetaTrader. The broker offers the stock as a futures contract, the trader posts a margin, and the position is marked to market daily. The advantage is the exchange-traded product; the disadvantage is the limited availability.
Common questions about MetaTrader for day trading
Is MetaTrader free? The MetaTrader platform is free to download and use. The broker may charge a fee for the market data or for the platform access. The cost is usually included in the broker's fee schedule.
Can I use MetaTrader on a Mac? MetaTrader is a Windows platform. Mac users can use MetaTrader through a virtual machine (Parallels, VMware) or through a MetaTrader Web platform.
Does MetaTrader support stock exchanges? MetaTrader supports the brokers' stock CFDs and stock futures. The platform does not support direct stock exchange trading. The stock availability depends on the broker.
Related resources
Where to start
If you are evaluating MetaTrader for day trading stocks, the most useful first step is to check the broker's product range (the stocks available, the CFDs or futures available), the platform's features (the charting, the one-click trading, the automated trading), and the data feed (the real-time data, the Level 2 data). Our broker comparison lists the MetaTrader brokers and the available products, which together tell you what the platform looks like before you download it.