Efficiency and speed are critical to your success as a Forex trader. You can optimize these by using Forex trading tools like trading robots, expert advisors, and, most importantly, virtual private servers (VPS). A Forex VPS hosting facilitates 24-hour trading, efficient trade execution, and strong security to facilitate trades and help you improve your trading results. Unlike shared servers, private servers provide dedicated resources to individual Forex traders and grant them full access to a remote computer. Connecting the Forex VPS to your local trading tools (MT4, MT5, Forex robots) would ensure that these tools are always online and your trading processes are constantly up and running.
In this article, you will learn the details of Forex VPS - what it means, why you need one, and how to choose the best VPS. Let's begin!
What Is a VPS For?
A VPS is a virtual private server, but in simple terms, it's a virtual computer that you can access from your local computer. These private servers are offered by several companies that will give you an allocated computer for a fee. All the users may share the same server, but they have their allocated private resources.
A VPS allows Forex traders to stay connected to the Internet 24/7 without being affected by faulty computer hardware, power cuts, malware, software lag, and other issues that plague computer users today. The Forex trading VPS is always connected to the internet, and its high speed of operation allows for:
- Quick execution of trade orders
- Efficient trade management
- Effective application of trading resources like expert advisors.
- 24-hour Forex trading operations
A VPS can transform your trading results by reducing the impact of software lags, slippages, power cuts, and other hindrances to your trading.
How Delay Affects Forex Trading
The Forex market is highly volatile, and as a result, it is constantly in motion - reacting to the news, economic data, and changes in the supply and demand for currencies. This constant motion places a burden on traders to ensure that the execution and management of trades are efficient and fast to get the optimum trade entries and exits.
Sub-optimal trade execution can lead to delays which can have negative impacts on your trading results. If a delay occurs, your broker will be unable to fill in your trade order at your preferred price. Consequently, your order will be filled at the next possible price. This can lead to loss of funds and poor trade entries.
Delays can also alter the percentage risk exposure of your trades. As a trader, you can calculate and predetermine your percentage risk by factoring in the entry and exit points for your trade. When delays occur, your order might be filled at a different entry price, and this alters the amount you're risking on that trade.
A delay in trade execution can be caused by a variety of factors, including:
- Quality of internet connection
- Computer's processing speed
- Broker's execution speed
- Spread and market liquidity
As we discussed earlier, a Forex VPS is constantly supplied with high-speed internet, with the ability to transmit trades faster. This prevents delays and ensures that your trades are executed speedily without latency.
How To Reduce Slippage With VPS
Whether you're executing trades manually or through an expert advisor, slippages are bound to occur if you don't use a VPS. Slippages are a consequence of delays in Forex trade executions. They occur when your trades get filled in at price points different from your preferred price. It applies to all trade orders; limit orders, market execution, and orders like stop loss or take profit used to manage trades.
To reduce slippages with Forex VPS, you need to connect your trading platform to the VPS. Most private servers can accommodate manual trading or automated trading - therefore, any trader can use a VPS when necessary. The orders executed with virtual private servers are instantaneous and fast.
Why is Forex VPS Right For You?
If you're confused about whether or not to purchase a VPS, there here are five reasons why a Forex VPS might be right for you:
1. Secure Trading Environment
Virtual private servers are secure networks because, unlike shared servers, private servers allocate dedicated systems and resources to you. These systems have sophisticated security algorithms and password protection. Some now possess two-factor authentication protocols.
The private servers are not prone to malware attacks because they possess inbuilt antivirus software.
2. Efficient Trade Execution
The trades executed on virtual private servers are instantaneous and protected against slippages caused by delayed execution on local computers. This helps you maximize the potential of your trading strategy and optimize your trade entries and exits. If you want to avoid losing money due to slippages, consider using a Forex VPS.
3. Optimization of Trading Tools
To make the most out of your trading tools, you may need to connect them to a Forex VPS. Most Forex expert advisors need to stay connected to the internet for them to function optimally. Without an internet connection, they won't be able to scan the Forex market for trading opportunities. The best way to keep them working at all times is to connect them to a virtual private server. Your local computer can be affected by a power cut, internet instability, or hardware failure. You can overcome these by using a VPS.
In addition, your trade management expert advisors should remain connected to a high-speed internet connection that keeps them up and running. Trade management expert advisors help to manage your trades and protect your capital. If these fail, you may lose some capital due to poor trade management. The best way to optimize these resources is to connect them to a Forex VPS.
4. Trading Strategy Testing
As a trader, you have to find new ways to improve your win rate and trading results. To do this, you have to develop creative ways to improve your trading strategy by adding or removing certain variables. Afterward, you would need to test your strategy in the Forex market to ensure that it works - that's where a Forex VPS comes in! The virtual private server helps you test your strategy efficiently since it's always connected to the internet and the live Forex market.
5. Ease of Access
A VPS grants you access to your trading platform from anywhere around the world, as long as you have internet access.
How To Choose Forex VPS Hosting
If you need to choose a Forex VPS hosting, here are five tips to get you started.
- Uptime: Choose a VPS with high uptime, preferably 99.9%, to ensure that your activities are uninterrupted.
- Versatility: A versatile VPS can accept a variety of trading tools like Forex robots and trading software.
- Location: To ensure efficient trade execution, you need to use a VPS that is located close to your broker's server.
- Performance: The performance of a VPS can be negatively affected if it's overwhelmed. When a user on the server has a lot of workloads, this can affect other users. The best virtual private servers can manage the compartmentalization of their users efficiently.
- Cost: Choose a VPS that offers a variety of subscription plans. This helps you choose the best plan that meets your needs.
Finally, as a Forex trader or investor, you should always find ways to improve your trading processes and results. The best ways to begin is to use a Forex virtual private server to eliminate some trading challenges you may be facing.