A Difficult, Yet Crucial Decision
Deciding whether to purchase an MT4 license is a critical decision for both new entrants to the market as well as existing brokers looking to take the next step. Recently we had a discussion with a potential client who expressed interest in our MT4 server consulting services. We decided the major discussion points were worth sharing with our followers as the cost/benefit analysis provided can help those faced with a similar decision come to the best outcome for their business.
The greatest challenge is that there is little middle ground between a white label and a server license. It’s akin to an all-or-nothing decision. When one upgrades to an MT4 server license, a multitude of doors become open that were once closed. The trade-off, however, is that it’s quite a leap financially. Consider that for a relatively low investment one can now offer the major facets of a brokerage: execution, pricing, markups, and a platform. The next logical step, owning an actual license, offers plenty of benefits but involves a much larger financial commitment. The greatest benefit to those who purchase an MT4 server license is flexibility.
Flexibility All Around
To compete at a higher level, a broker has to have pricing flexibility, namely unique markups across pairs. Although white labels offer this, it can become increasingly expensive to do so and some providers might cap the number of unique pricing streams.
Flexibility also factors in to which price stream, bridge, and provider the broker decides to work with. A white label can only select from the providers and bridges approved by their white label partner.
The ability to make on the fly changes is another major benefit. A white label provider must approve any client requests. When it comes to adding new groups, symbols or other features the waiting time could be several business days, something a broker with a server license doesn’t need to worry about. Finally, brokers are free to add custom MT4 server plugins or other enhancements like a trading cabinet and will also have full control over the MetaTrader 4 API, allowing them to develop their own tools without being restricted by white label provider limitations.