How does Forex VPS Hosting Work?

For those new to virtualized hosting paradigm, the technical concept of a forex VPS can be difficult to understand at first glance. In this article we aim to help explain exactly what’s going on “behind the scenes.”

The premise of VPS hosting (virtual private server hosting) is to divide the resources of a single physical host machine into smaller “virtual servers.” This is accomplished with the use of specialized software, which allow multiple operating systems to be run on the same machine, at the same time. Technically, the operating systems are being virtualized on the kernel level — they are 100% separate and isolated, not simply different users within the same system.

The diagram below shows the difference between a traditional, single-purpose machine, and a machine utilizing virtualization software:

Virtualization Diagram

Virtualization technology allows us to colocate large and specialized machines in financial data centers, which the average trader or small business may not be able to justify the cost of. The colocated hardware is then “split” into several isolated VPS instances per machine, and leased as virtual server units to our clients.

In addition to the obvious cost benefits, there are numerous security and performance benefits of virtualized hosting. Because each VPS instance is completely isolated, but none has access to the physical machine’s core operating system, the uptime and security of the system as a whole can be more efficiently managed by our technicians.

For users, the primary advantage gained by virtualized hosting is the ease of performing platform upgrades and expansions. Resources from the physical host machine can be allocated to virtual servers instantly, and without interrupting the system’s performance for extended periods of time, unlike traditional hardware upgrades. This principle allows users to select only the resources they require, and expand as needed at a later time.

For more information about the specific benefits and features of forex VPS hosting, see: Forex VPS Features

[From the FXVM Blog:]

Do you need a Forex VPS? Who should use a VPS for trading?

With the huge variety of trading products and platforms available to traders, it is often difficult to determine, at a glance, what will be truly beneficial for a reliable trading setup. However, with the rapid development of automated systems, virtualized hosting technology, and access to premium bandwidth in financial centers, it has become clear that specialized financial hosting infrastructure can benefit the performance of trades and trading applications. There is no better evidence than the fact that a majority of trades executed on today’s markets are executed by automated trading systems.

FXVM’s goal is to virtualize–or partition into small, self-contained, ‘virtual’ sub-units–such infrastructure, and extend its benefits in the form of a virtualized hosting service to all traders and businesses who are seeking improved stability.

If you are unsure about using a forex VPS, and whether you should be using one in your trading setup, consider some of the following reasons that our customers use forex VPS hosting:

  • You have a forex expert advisor, or many EAs, that you need to test in a stable environment.
    • Forex VPS systems do not shutdown or reboot, and are designed to have the best possible quality of connection to brokers and financial institutions. For these reasons, forex VPS hosting is ideal forward-testing MT4 EAs and other automated trading software, especially when results need to be collected over many weeks, months, or years. Read more about the benefits for forex expert advisors.
  • You already have a profitable EA or automated trading portfolio, and require a stable remote environment to optimize returns from your system.
    • For all of the same reasons mentioned above, forex hosting is ideal for deploying established, profiting strategies, in order to give them an additional edge in fastest possible execution speed.
  • Your system or software requires ultra-low latency connection to the broker.
    • Because our systems are hosted directly adjacent to major financial data networks in New York (Equinix) and London (Level3), they can achieve latency as low as 0.1ms to a large number of brokers and trading services. Check our live latency to your broker.
  • You are frequently away from your computer or trading station.
    • A trading VPS runs on a remote server located in a data center, and can be accessed from any PC or mobile device via RDP. This means that you can “screen in” to your remote desktop from any location, while leaving the applications on the remote desktop to run uninterrupted.
  • Your orders are executed poorly due to long distance between your broker(s) and your location.
    • Hosting your MetaTrader 4 platforms on a remote VPS will improve the speed of order executions, since the trading machine will be closer to the destination networks, even while you access the VPS from your location.

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