A 5 millisecond server delay could cost a firm as much as 4 million USD every millisecond”
Millions of traders rely on complex technology solutions each day with millions of dollars being transmitted every millisecond. But how often do traders really think about the technology they are using and do most traders fully understand its impact? It’s an area few have explored but recent surveys suggest that trader’s knowledge varies widely.
Most companies and some individuals rely on server technology to power their trading activities. A logical choice for many but what are the key elements of these and how can you as a trader gets the most out of them? After all, a delay or a poorly configured server can be the vital difference between a successful and non-successful day.
Understanding Your Server
Of course, most traders aren’t that familiar with the deeper workings of server technology but they do have an understanding of how these fit into the overall process of trading. While we don`t need to get into these finer details traders should know about some of the core things they should require of their server, for example speed and down time rates.
With daily trading equation roughly to 4 trillion dollars traders understand the importance of timing. While traders may know when to execute a specific transaction it may take a server some additional time to process it. In turn it is important to have a server that responds quickly. While the obvious thing to do would be to look at hardware traders should also ask their technicians to closely inspect internet connection speeds and server logs. A server that is working overtime on things such as non-essential tasks will slow down your trading.
The other big area for consideration is uptime. Traders will want to ensure they experience as little down time as possible. This means careful maintenance programs and good backup systems are required. Traders will want to make use of specialist server providers like Artmotion of Switzerland. A good supplier can make a huge different and is very important these days as many companies outsource their server requirements.
Since we are dealing with financial transactions security is also vitally important. The aim is always to reduce the risk of being compromised. There have been well documented cases of this and it can cost firms millions of dollars.
Gaining through Knowledge
By nature Forex trading is very competitive and the very best traders are constantly on the move and updating their skills. Many have learned about the growing complexities of technology and continually try to innovate in this area. While it is not always possible to innovate traders should look to develop their understanding in a wide range of areas including technology. Many have done this and now work closely with their IT technicians to deliver the best possible results. Regular audits provide a great starting point and there are many ways to monitor your server performance. In truth, there is no one solution that will fit all. It is largely about finding a solution that fits you and optimizing it as best possible.
However you decide to approach this there is no doubting the impact of technology on your trading performance. Down time, server outages and slow connections are a key part of success and trading technology will continue to evolve long into the future.
Via James Hounslow, Richard Twumasi