What is Forex VPS Hosting?


VPS hosting for forexWhat is a forex VPS? VPS stands for Virtual Private Server, and is ordinarily used by network administrators and programmers as a means of working remotely on network applications irrespective of global location.

Lately, virtual private servers have started to see increased utilization in the forex market, as the need for this technology in the financial markets has now become evident. Forex VPS is therefore a specialized form of virtual private server services that have been adapted for use in the forex market.

A forex VPS hosting service can be used by forex traders to keep their trading activity running 24 hours a day, 7 days a week, without running their own computers at home or in the office all the time. This helps avoid problems such as connectivity issues and power outages. With a forex VPS hosting service, a trader can connect remotely to a powerful server with a clean Windows-based desktop interface which mimics the desktop interface of the trader’s personal computer. This enables traders to do the following:

  1. browsing the web
  2. downloading Metatrader 4
  3. installing forex trading programs
  4. managing trades with different brokers

How does a forex VPS hosting service work?

a) The Setup
The essence of a forex VPS hosting service is to provide the trader with a complete Windows virtual desktop that can be accessed and used round the clock from anywhere in the world, allowing the trader to maintain connectivity to the trading platforms at all times.

New installations and server reboots do not affect the operation of the platform or any software, which can pick up from where trading activity left off. A forex VPS package will provide the trader with full Admin access via Remote Desktop, giving the trader complete control of forex trading activity just as if the trader is trading on the desktop computer. In order to ensure this, the forex VPS hosting service is physically setup as described below.

A forex VPS hosting service has to be housed in a data center. Many of the world’s sophisticated data and disaster recovery centers are built in New York, New Jersey, Atlanta as well as in London and other locations in Europe and Asia, providing a coverage that has a global reach. These forex VPS facilities are usually constructed physically with reinforced concrete and massive steel frames without windows to provide a physically secure facility that cannot be breached by intruders.

The data centers are fed with redundant paralleled power systems. Some facilities provide extra redundancy bypass mechanisms to enable offline maintenance without affecting the power supply to the facility. The facilities are backed up with an Uninterrupted Power Supply (UPS) system run by state of the art generators, all computer controlled and automated to ensure power supply round the clock. The fuel systems to the generators are all computer-controlled.

The servers have to be maintained in a temperature controlled environment, usually on the cold side of the spectrum. Each data center will therefore be equipped with temperature sensors which can monitor temperature conditions in the facility and make adjustments.

The data centers are fed to the main fiber backbones from the richest fiber network hub in the country of location, providing access to major telecommunications and news providers. This is what enables a forex VPS hosting service to catch news releases as they happen and feed the data back to the trader’s platforms.

b) Functionality

Forex VPS hosting services can be provided free to trading account holders by brokers. Usually, there are third party providers who provide specialized forex VPS hosting services. These vendors usually charge a monthly subscription, with different plans containing different VPS service packages.

Once the forex VPS hosting service has been setup and is functional, the trader is allocated an IP address, along with a username and password with which to gain access to the forex VPS. If the trader has a Windows-based operating system, a program known as ‘Remote Desktop Connection’ can be accessed by clicking on the Start menu button and following this pathway:

Start > Accessories >Remote Desktop Connection

There is no need to install anything as the program runs on Windows operating system by default. Once the pathway has been followed and the program is up and running, the trader simply enters the username and password provided by the VPS hosting service provider and the connection to the forex VPS is established.

For traders who are using computers that run on the Linux based operating systems (Ubuntu or Mac computers), the pathway to access the remote functioning of the forex VPS is gained by entering as follows:

System > Preferences > Remote Desktop.

The login details are entered and the trader is presented with a “virtual desktop”. From here, the trader can choose to either download the MT4 platform from the VPS browser, or simply copy and paste files of the expert advisor from the computer to the VPS.

There are several uses of a forex VPS hosting service. Some of these are as follows:

One use which has become quite popular, is in setting up an expert advisor to trade remotely, independent of the trader’s desktop or computer facilities. We all know that using a computer with an internet connection is subject to all manner of failures. Some of these are power outages (especially in developing countries), problems with internet connection (such as slow service, bandwidth issues, poor connectivity) and mechanical issues such as computer hard disk crashes. If you use an MT4 platform broker, you will also discover that this trading platform is not compatible with the Mac or a computer with a Linux-based operating system. If an expert advisor is setup on a computer and any one of these problems develop, the trader loses the ability to trade automatically with his EA or in worst case scenarios, cannot control open trades.

By getting a reliable forex VPS hosting service, these issues are eliminated. A forex Virtual Private Server located in a data center with high quality hardware can provide power systems that run 24/7, and can provide multiple internet connections from major internet service backbone providers, ensuring that your expert advisors and other software attached to your trading platform can run your trades in a manner that is far more dependable than a desktop PC operating from home.

Perhaps one of the best uses that a forex VPS hosting service can be put to is in providing high-speed ultra latency trading facilities for the trader. The forex market has evolved greatly and with the increase in the volume of trade as well as number of market players, prices can move very fast in a matter of seconds, especially in news trades. Manual traders and those who rely on their expert advisors need to be able to respond extremely fast to changing prices by placing timely order for the best execution times. This is especially true for traders who trade very high volumes, where a single pip movement can translate into a gain or loss of thousands of dollars.

The best way to ensure timely execution of orders, especially in news trades where response times to news releases has to be in the order of milliseconds for the trade to perform as expected, is to colocate. This means, to site your trading platforms and expert advisors in servers that are close to the news servers where the news is released, or close to the data centers where the forex price feeds emanate from. Since it is impossible for most traders to physically relocate to these locations, the answer is to use a forex VPS hosting service located in geographical proximity to these data centers or news centers.

Siting your order execution software close to the data centers will mean that you can enter trades faster than anyone else, respond to changing prices faster, trade the news with a great deal of success just like the big dogs do, and generally enjoy seamless and smooth trading.

A forex VPS hosting service is an indispensable tool for anyone who wishes to make a success in today’s forex trading arena. Any trader who trades forex for at least 4 hours a day, lives in areas that experience frequent power disruptions, has to use a cybercafe for trading or shares computers with others, needs a forex VPS hosting service.

Any trader who also trades with expert advisors and needs them to run round the clock, as well as traders who trade with several MT4 brokers, also need a forex VPS hosting service.

If you have not started using a forex VPS hosting service, ask your broker for one today, or subscribe to the service from any one of the various third party providers available.

The author’s views are entirely his or her own.


About Author

Dankra is a forex trader who has played the markets for 7 years. He also trades binary options and spends his free time developing strategies that traders can use to beat the markets. He also codes indicators and EAs for the MT4 platform.