Trading VPS: when you actually need one

A VPS is a virtual server running continuously in a data centre. For trading it solves a few
specific problems — and does not solve the ones many people buy it for.

1. When you genuinely need one

• Running an EA. An EA only works while the
  platform is open. If your computer shuts down or loses power or connectivity, the EA stops — usually
  without you knowing.
• Using MetaTrader’s
  trailing stop. It runs on your
  machine, not on the broker’s server.
• Latency-sensitive strategies. A VPS near the broker’s server cuts latency from
  hundreds of milliseconds to single digits.
• An unreliable internet connection — a real problem in plenty of places.

2. When you do not

• Manual trading on H4 or D1, a few trades a week.
• Always using a server-side stop loss and take profit —
  they work with your computer off.
• No settled strategy yet. A VPS does not improve a strategy that is not working.

The point worth stating plainly: ordinary stop-loss and take-profit orders sit on the
broker’s server and keep working when your computer is off. A lot of people buy a VPS worrying
about this unnecessarily.

3. How to choose one

• Location is the most important criterion. Pick a data centre near your broker’s
  servers — usually London, New York or Amsterdam, depending on the broker. Ask the broker’s support
  where their servers are.
• Specification — one MetaTrader instance runs happily on 2GB of RAM and one CPU
  core. Three or four instances need 4GB.
• Uptime guarantee — 99.9% at minimum.
• Operating system — Windows Server, so MetaTrader runs without an emulation
  layer.

4. Free VPS from the broker

Many brokers offer a free VPS once you meet a minimum balance or monthly volume. That is often a good
option:

• Already placed close to that broker’s own servers.
• No cost if you were going to meet the condition anyway.

The downsides: the specification is usually basic, and you are tied to that broker.

5. How to check latency

In MetaTrader, the bottom-right corner shows latency to the server in milliseconds. Compare that
number on your own machine and on the VPS:

• Above 100 ms — worth improving if you trade short-term.
• Below 10 ms — very good, and usually only achievable with a well-placed VPS.

For swing trading the number barely matters. For scalping
and high-frequency EAs it feeds directly into
slippage, and therefore into real cost.

This article is for information only and is not investment advice. Conditions and fee levels are published by the brokers and can change at any time — check with the broker you actually use. Leveraged forex and CFD trading carries a high level of risk and can cost you your entire deposit.