Common Metatrader 5 scams

Metatrader 5 has become a widely used platform in the rapidly evolving world of online trading, providing traders with an abundance of options. Wherever there is money to be made, there will be those looking to take advantage of unsuspecting traders, as the saying goes. That’s why Traders Union experts have stepped up to help traders navigate these dangerous waters. In this article, we will investigate Metatrader 5's dark side, exposing some of the platform's most common scams. Experts from Traders Union will provide valuable insights and strategies to help you avoid falling victim to fraudulent schemes.

What is Metatrader 5

MetaTrader 5, often referred to as MT5, serves as a comprehensive trading platform designed for institutional use. Unlike its predecessor, MetaTrader 4, which primarily focuses on Forex trading, MT5 offers a more extensive range of assets, including stocks and commodities. It comes in various versions, including web, online, and mobile, making it accessible to traders across different devices. One of its standout features is the inclusion of built-in trading robots , along with a freelance database for strategy developers, enabling users to automate their trading strategies. Additionally, MT5 offers copy trading and virtual hosting services. The platform boasts a user-friendly interface available in 31 languages, and it is typically accessible through your chosen broker at no additional cost.

Can MT5 be trusted?

Yes, MT5 can be trusted. Traders from all over the world use the reliable trading platform MetaTrader 5. A respectable company in the financial software industry, MetaQuotes, is its creator. The strong security features, open implementation, and regulatory compliance of MT5 make it the recommended option. Although MT5 has earned a lot of trust, it should be combined with trust in your chosen broker.

Read also: Has MT4 and MT5 been banned? in the TU article.

What are the most common MetaTrader 5 scams?

Traders need to be aware of the five common scams that happen on the MetaTrader 5 platform in order to safeguard their funds and make informed decisions. For your convenience, TU experts have highlighted them below.

The rotator scam

In the rotator scam, fraudsters advertise a trading system that supposedly guarantees substantial profits. They often promise minimal risk and high returns, enticing traders to invest their money. However, once traders commit their funds, the scammers rotate to a different scheme, leaving victims with significant losses.

Automated trading robot scam

This scam involves selling automated trading robots or software with the promise of quick and effortless gains. Traders are lured by the idea of making money while they sleep. In reality, many of these robots are ineffective, and some are even designed to siphon funds from trading accounts.

Forex robot scam

Similar to the automated trading robot scam, the Forex robot scam promotes the idea of profitable trading robots that can outperform human traders.

MT5 expert advisor scam

MT5 expert advisors (EAs) are automated trading tools used on the platform. Scammers may offer EAs with unrealistic profit claims, only to deliver ineffective or even harmful software that can lead to financial losses and account compromise.

Phishing and malware

Scammers may use phishing emails and malicious software to target MT5 users. These tactics aim to steal login credentials and personal information, potentially leading to unauthorized access to trading accounts and financial theft.

What are the most trusted MetaTrader 5 brokers?

The most trusted MetaTrader 5 brokers are those with Tier 1 regulation, which means they are overseen by the top financial authorities known for their strict standards and rigorous enforcement, ensuring the highest level of security and transparency for traders. We compared the trading conditions of three such brokers.

How to protect yourself from trading scams?

The TU experts have highlighted crucial tips for beginners to safeguard their investments when it comes to avoiding trading scams. Beginners should give these steps top priority.

Research and due diligence Before diving into the world of online trading, it's crucial for beginners to conduct thorough research. Understand the basics of trading, the assets you wish to trade, and the market conditions.

Educate yourself Knowledge is your best defense against scams. As a beginner, take the time to educate yourself about trading strategies, risk management, and the specific tools and features of the trading platform you intend to use, such as MetaTrader 5.

Choose a reliable broker The most crucial step for beginners is selecting a trustworthy broker. A reliable broker should be regulated by a recognized financial authority, have a transparent fee structure, provide excellent customer support, and offer a secure trading environment. Reading reviews and seeking recommendations can provide valuable insights into the reputation and reliability of brokers.

FAQs

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Team that worked on the article

Winnifred Emmanuel

Contributor

Winnifred Emmanuel is a freelance financial analyst and writer with years of experience in working with financial websites and businesses. Her expertise spans various areas, including commodities, Forex, stocks, and cryptocurrency. Winnifred tailors her writing to various audiences, including beginners, while also providing useful insights for those who are already familiar with financial markets.

Learn about our editorial policies

Dr. BJ Johnson

Developmental English Editor

Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.

Mirjan Hipolito

Cryptocurrency and stock expert

Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).

Glossary for novice traders

ECN

An ECN, or Electronic Communication Network, is a technology that connects traders directly to market participants, facilitating transparent and direct access to financial markets.

Risk Management

Risk management is a risk management model that involves controlling potential losses while maximizing profits. The main risk management tools are stop loss, take profit, calculation of position volume taking into account leverage and pip value.

Cryptocurrency

Cryptocurrency is a type of digital or virtual currency that relies on cryptography for security. Unlike traditional currencies issued by governments (fiat currencies), cryptocurrencies operate on decentralized networks, typically based on blockchain technology.

Forex Trading

Forex trading, short for foreign exchange trading, is the practice of buying and selling currencies in the global foreign exchange market with the aim of profiting from fluctuations in exchange rates. Traders speculate on whether one currency will rise or fall in value relative to another currency and make trading decisions accordingly. However, beware that trading carries risks, and you can lose your whole capital.

Expert Advisor

An Expert Advisor (EA) is a piece of software or script used in the MetaTrader trading platform to automate trading strategies. EAs are programmed to execute trading decisions based on predefined criteria, rules, and algorithms, allowing for automated and systematic trading without the need for manual intervention.