Computer software is fast replacing humans in the task of making trading decisions in the Forex market. This is known as automated or algorithmic trading. Now, traders can set up their devices, install trading software, and watch it make trades and generate returns. These systems are devoid of the emotions of fear, greed and hope that cause human traders to generate consistent losses in financial markets. Unfortunately, many traders who use automated trading have not learnt about the best forex VPS service around.
Forex VPS (Source: Learn 2 Trade)
For automated trading systems to work optimally, they must be up almost all the time. That is, in essence, the devices upon which the software is installed must always be on and connected to the internet. If this is not the case, the software may miss out on a lot of good trading opportunities. Logically, having the trading device on at all times is not practicable. There is, however, a technology that fixes this issue and that is the Virtual Private Server (VPS).
What is a Virtual Private Server?
Whenever you use your computer, you are generating and dealing with data. It is the work of your computer to not only process but store your data which may be in the form of text, videos, photos, music, and more. However, if your computer is not powered on, it cannot process these data, nor can you access them.
Also, the owner of the data will have to carry their device around everywhere, if they ever want to access what is stored there. The server, however, solves this. To understand this, we may need to liken it to the website-hosting server that you most likely are already familiar with. Whenever people set up websites, there is a dedicated server somewhere that stores all the information generated or processed on them. As a result, the data on a website can be accessed by anyone from anywhere at any time without the owner’s device being powered on.
Forex traders who need to have their trading software running all the time need servers, too. With their own servers, their trading algos don’t need any device or access to the internet to get their jobs done. They can, in essence, make money round the clock. Dedicated servers are, however, expensive which brings in the concept of virtual private servers. With VPS, anyone can access server services without being assigned a special or dedicated server.
VPS services keep the data on a virtual server which helps keep the data online at all times even without the device being available. Traders can also access their data and software remotely from anywhere in the world.
Why Forex VPS?
Many traders ask, “Do I need a Forex VPS?” If you also have this question, we highly recommend that you go for one as the benefits that come with a Forex VPS are ample. Here, we discuss just a few of those benefits.
- Faster Trade Execution
A lot of traders lose money in financial markets not as a result of poor trading skills but circumstances beyond their control. These circumstances beyond a trader’s control usually include the speed of execution of trades. The Forex market is highly volatile with high frequency whereby if your trades lag by a few seconds, you can be on to some losses. As a result, there is the need to make use of systems and software that assure you of a fast trading speed.
Using VPS in Forex gives you a much quicker trade execution speed than manually buying and selling from your personal computer. This is because the private server communicates much speedily with your broker’s server to get your trades executed. One hidden benefit of this is that it makes you a better trader. When you use VPS in Forex, you get to benefit from quick movements in the markets, potentially adding a lot more to your profits.
Furthermore, you experience minimal slippage. Slippages occur when there is a lag between the times trades were entered and when they were executed. Slippages can be very expensive, and traders need to avoid them. One good way to do so is to trade with VPS.
- Maximum Uptime
As a human trader, it is virtually impossible to have your trading systems run all the time. You have to carry out other basic life tasks and so will be away from trading from time to time. Then, also, your trading devices cannot be put on perpetually, without end. Thus, whether you yourself trade or you use software, your trading time is limited.
However, this is not a problem when you use VPS in Forex trading. When set up, the VPS service ensures that everything relating to your Forex software such as the MetaTrader 4, works perfectly fine even if your device is switched off or there is no internet connectivity. This will become even more beneficial if you are using algorithms to trade. The VPS ensures that your software will not miss opportunities to make money for you.
- Trade the Markets from Anywhere
After you have started trading for some time, you will most likely realise that you need a dedicated trading station, either in your home or anywhere else. However, you will have to be confined to a particular spot as you cannot take your trading station everywhere with you. Even if you make use of a PC to trade, your broker’s security rules might not allow you to change locations often.
The VPS changes all of these. When you trade Forex with VPS, you get to access your trading software from any device and from anywhere in the world. You are essentially free from all location restrictions to trading in financial markets.
- Safety and Security
One more benefit you get from using a VPS in trading the Forex markets is that you are much safer and secure. Many VPS services have a dedicated community that monitors and constantly updates network activities and the installations of antivirus. This way, security breaches and other digital skirmishes are avoided. Furthermore, there is significant reduction in the probability of errors or crashes happening.
How to Choose a VPS in Forex
Now that you have appreciated the benefits of VPS and understood how valuable it is to your trading, you may want to go for a VPS service. There are several providers of VPS services out there, but it is important to note that all VPS services are not created equal. Some providers do not offer as many optimal services as those of others. To avoid going for the wrong VPS service, we have outlined a few criteria to look out for when selecting a high-performance forex VPS hardware. These include:
- General Hosting Vs Specialist Hosting
When picking a VPS for Forex trading, you can choose from either regular web hosting or a specialist hosting dedicated to Forex trading. Nonetheless, we highly recommend that you go for a specialist robot hosting designed for forex trading. This is because, although they are much more expensive than the regular ones, they have more features that are tailor-made for forex trading. Also, you don’t need specialist knowledge to get them set up.
On the other hand, if you are tech savvy, you may consider the general ones and then adapt them to your trading.
- Configuration and Flexibility
You should also consider specific details in your desired Forex VPS service to know if they conform to your specific needs. For instance, you should know if the RAM storage provided is reasonable enough. Then, the speed of data transfer and the protocols on data backup are other considerations.
Even at that, you should pay particular attention to whether your provider allows for flexibility within each plan. Can you expand the RAM or the bandwidth when your trading needs require such?
- Compatibility with Operating Systems and other Technical Details
Many operating systems can work with a Forex VPS. However, it is advised that your VPS service be optimised for one operating system rather than multiple. This is because it is common to see VPS that are made for one operating system performing better than general-purpose VPS services.
Linux and Windows are the leading operating systems for Forex VPS; however, on a much smaller scale, there is also Mac OS. Nonetheless, Windows is the most popular, and we have discovered that Forex VPS based on Windows seems to work efficiently. Thus, we highly recommend you go for a VPS hosting that works well with Windows.
- Compatibility with Platforms and Expert Advisors
There are several trading platforms you can choose to trade from. However, since you most likely will be trading with expert advisors, you should only trade with platforms that allow them. Some popular names include MetaTrader 4 and 5, TradeStation 1 & 2, Ninja Trader, Zulu Trade, and more.
This invariably means that your Forex VPS must accommodate and be compatible with these platforms. It is worth adding that MetaTrader 4 & 5 are the most popular platforms, and as such, most Forex VPS services are compatible with them.
- Safety and Security
Forex trading involves putting your hard-earned money, or sometimes those of others, on the line. Thus, you should ensure that whatever platforms, systems or software connected to your trading ensure maximum security. These include your Forex VPS. Your Forex VPS service should typically have firewalls protecting you. There should also be regular automated security checks to detect and protect against breaches very early.
After looking at the above criteria and more, it is important to make sure you are not dealing with a VPS Forex scam, as VPS Forex scams are quite rife.
Using a VPS in Forex trading has the potential to significantly improve your trading and generate even more profits for you. However, for this to happen, it must be the right Forex VPS hosting. Otherwise, you may actually harm yourself. The above criteria should enable you to make the right choice.