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Benefits and Demerits of Virtual Privates Servers in Forex Trading

Forex trading is a game of probabilities. Each trade comes with its own set of risks, rewards, and historical win rates. To improve the chances of winning, traders must constantly work and improve on their craft. A forex VPS can help overcome many of the trading disasters associated with poor hardware, internet connectivity and latencies, to name a few. 

What is a Forex VPS?

As the name indicates, a VPS is a virtual machine in a cloud that hosts an operating system. A forex VPS is dedicated to trading currencies and is specifically catered to run trading platforms. These VPS systems can be set up in person or purchased online from a company. 

Benefits of VPS in Forex Trading

Due to their versatility, cost, and performance benefits, virtual private servers (VPS) have become an important part of the modern trading regime. Here are some common benefits of these virtual machines.

Hosting Trading Platforms

Forex VPS systems allow you to run your trading platforms, such as MetaTrader 4, cTrader, Ninja Trader and customer applications. Running this software on a cloud-based virtual machine ensures smooth and uninterrupted operation.

Trading Algorithms

Traders can run their expert advisors 24/7 without any need for manual intervention. On a local PC, they may have to start and ensure their operating system keeps on while the EA runs. A forex robot is best ran in a 24/7 enviroment so that the bot can take advantage of all trading oppurtunties.

Backtesting Strategies

Backtesting your trading AI over a local server can consume tremendous computing power. With the help of a VPS, you can free up your system resources and enhance the life of your hardware at a fraction of the cost. Traders may also test out their manual strategies.

Account Management

Big institutions or traders can use VPS systems to manage other accounts. Clients can purchase and set up their platform on one of the VPS, and traders can then place their trades by logging into the OS. This simplifies the overall process of account management.

High Frequency Trading HFT

High Frequency Trading algorithms require ultra-low latency, i.e., less than 5 ms. For local market participants, these expert advisors would be nearly impossible to run without a VPS setup close to the broker's data center. VPS companies have set up their virtual machines close to these data centers to ensure minimal slippage and better performance of HFTs.

Remote Access

Traders can access their trading activity on the go with the help of a remote desktop connection. This only requires the internet and a suitable device that can run RDP, such as a mobile or a laptop.

Security Measures

VPS systems enforce robust security measures such as firewalls, encryption, and defense audits to ensure your trading strategies and accounts remain safe. The server is regularly scanned for any malware or trojans.

Uptime Guarantee

Reputable companies offer a 99.9% uptime guarantee for their virtual systems. They have backup systems for power outages and internet failures. Even in case of a local disaster, they can shift data from one VPS to another as they have multiple VPS server locations. 

Software and Data Storage

Top VPS companies have multiple packages that allow users to upgrade their storage as they require. Traders can also install custom software or analytical tools. 

Copy Trading

Copy trading involves copying positions from one account to another. This means that the entry point, stop loss, take profit and any additional changes while the the trade is live should be mirrored. Signal providers can set up master and slave accounts within a single VPS to fulfill their copy-trading needs.

Demerits of VPS in Forex Trading

Despite the development and upgrade of hardware and internet, VPS systems are not free from its downsides. Let us go through some in detail.


VPS with high RAM and CPU power may cost you a lot. These services are available for rental via a monthly or yearly subscription.

Technical Knowledge

As virtual machines need to be close to the broker's data center, setting up one yourself may incur renting and other costs, making it expensive. Those using a remote VPS for the first time may face hiccups while setting up a connection from their PC to the server.


Security updates and patches may require you to restart your VPS. Sometimes, the OS may enforce an update and restart. While this is necessary, it can stop all trading robots and software. Depending on the situation, you'll have to rerun each and manually close each position. 


Before purchasing a VPS, you must ensure that your trading platform is compatible with the OS. There might also be potential issues with the broker, which you'll have to work around.

Final Thoughts

Opting to trade locally on your computer on a VPS can boil down to personal preferences and needs. It is essential to remember that big banks and trading institutions have a huge advantage in terms of infrastructure over local traders. Using a Forex VPS may help mitigate the gap and rank you amongst the few profitable market participants. Thoroughly test your strategies on a VPS on a demo account before proceeding on a live portfolio to help access the trading conditions.

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