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7 Main Considerations Before Choosing a VPS Provider for Forex Trading

Success in the fast-paced and competitive world of forex trading can be built on fine margins, and it’s for this reason that many traders are increasingly relying on virtual private servers (VPS) to mitigate the friction surrounding their spot trades. But which VPS can best suit the specific needs of traders?

Choosing the right VPS to suit your specific trading objectives should be based on factors relating to both performance and usability. But in a competitive marketplace, it’s important to take an in-depth look at which providers can offer the most functional software. 

Because taking advantage of the right opportunity at the right time in the forex market can come with significant financial benefits for traders seeking to get the better of instances of slippage and uptime issues, it’s certainly worth shopping around for the ideal VPS to support your trading activity. 

What is a Forex VPS?

Fundamentally, a forex VPS is a virtual private server that’s been built to enable traders to place frictionless orders on the FX market. 

These servers can be utilized to manually trade currencies using external servers that promise better rates of uptime and lower latency. This paves the way for traders to utilize expert advisors and trading bots on a continuous basis without the need for their computers to be switched on. 

Because virtual private servers operate via the cloud, they can also be accessed through a range of devices, making it easier for FX traders to stay switched on no matter where they may be. 

It’s these benefits that can help traders to execute more trades without the risk of slippage eating into their profit margins, and with full confidence that a connection timeout could undermine an opportunity. 

But what factors should you consider when it comes to choosing the right forex VPS for your trading needs? Let’s take a look at seven key considerations to take before choosing your forex VPS provider: 

1. Uptime Guarantees

Server uptime loosely translates to a measure of reliability when it comes to executing the right trades at the right time within the forex market. 

Generally speaking, uptime is usually offered up as a percentage, and when shopping around for a virtual private server, you may find firms offering 99% uptime, which indicates that if a VPS has been operating for a month, it’s only likely to have been down for less than seven hours over this period. 

So, what does this mean for forex traders? Although seven hours in a month at 99% uptime may sound like an insignificant amount of time, this will render your trading activity inactive, potentially causing you to lose out on trading opportunities through your expert advisors. 

With this in mind, it’s essential that you shop around for servers that offer uptime that’s greater than 99% to ensure that you get your money’s worth from the trading opportunities the software presents you with. 

2. Slippage and Latency

The key perk of utilizing a forex VPS is its ability to offer super-low latency in helping to execute trades at the right price without incurring costly slippage. 

Slippage occurs when the price of a currency changes between the time in which a trade is actioned and finally executed. Because forex spot prices change at five-millisecond intervals, it’s imperative that traders seek to close the gap between actioning and executing trades by as much as possible to avoid missing out on their desired asset prices. 

For example, MetaTrader 5 VPS promises latency that features optimal access of less than five milliseconds for 82% of all brokerage servers. This helps traders to eliminate as much friction as possible between their chosen trades and their execution time. 

With home PC trading liable to take more than 200 milliseconds and more conventional VPS servers struggling to perform better, specialist forex VPS software can get rid of delays entirely. Factors like latency should be a key consideration when choosing your virtual private server. 

3. Fitting the Requirements of Your Expert Advisor

Another crucial consideration to take is to match up the specifications of the VPS that you’re exploring with that of your intended expert advisor to understand whether the software are compatible. 

Significantly, your EA’s programming language may require special software or hardware specifications that need to be paired up with your VPS in order for it to perform at an optimal level. To illustrate this point, if your EA is using MetaQuotes Language 4/5 you’ll need to utilize a VPS that supports Windows OS as standard

4. Price is Always a Key Factor

We’re in the forex markets to make money on our trading performance. It’s for this reason that spending on a VPS must always be financially justified in your bottom line. 

The cost of high-performing forex virtual private servers can range from a few hundred dollars to thousands annually. 

Naturally, the more expensive servers can be more sophisticated with better uptime and security features, but this won’t be worth much to you if it’s costing more than your profit margins. 

It’s for this reason that you should seek to analyze your market performance, and your expected improvements using a VPS and factor this into your overall ideal budget for a server. 

5. Server Location is Essential

Because good virtual private servers offer a range of hosting locations around the world, it’s easier to choose a VPS that offers a server near the location of your chosen brokerage. 

By utilizing a VPS that has a data center near popular brokerages, you can actively reduce the ping rate between sending your trade and having it executed by the brokerage. 

Again, this should be a key consideration if you know where you’re most likely to execute your trades, and by matching their location to your chosen virtual private server location, you can provide yourself with the best chance of trading at the prices you want. 

6. Security is Always Essential

When it involves currency changing hands, prioritizing security in your chosen VPS is always a good idea. 

Particularly if you’re a trader expecting to see significant volumes of FX involved in your trades, it’s imperative that you look at the security features of your VPS options such as its use of firewalls, intrusion detection systems (IDS), and how it utilizes virtual private networks (VPNs). 

7. Support Could Save You From a Costly Mistake

Oftentimes customer service can be overlooked when it comes to purchasing software because it’s hard to foresee when something could go wrong and you require urgent help. 

However, in the world of forex where mistakes can be especially costly, it’s certainly worth taking the time to explore how long it takes to get a customer service response, the quality of the support team in place, and the features available to help you to find the right help at the right time. 

It’s also important to check that the avenues for support suit your preferences. If you’d prefer to use live chat rather than speak on the phone, this consideration could become extremely useful should you require urgent help with your software. 

The world of forex trading is well known for operating in fine margins. When a matter of milliseconds can stand between traders and significant levels of profit from spot trading, utilizing the frictionless performance of a VPS can make a world of difference. 

In taking the time to consider factors surrounding performance, safety and usability, you could be paired with a VPS that actively expands your profit margins while bringing you more confidence in your trading strategies. In following the right precautions, your virtual private server could revolutionize your trading experience.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Dmytro Spilka

Dmytro is a finance writer based in London. His work has been published in The Financial Express, The Diplomat, IBM, Investing.com, FXEmpire, Investment Week and FXStreet.

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