Internet connection to trading – which kind, from which internet provider, for how much not to overpay? These are just a few questions concerning the choice of Internet provider for trading, but it is worthwhile to answer them.
I often hear question, what kind of connection I have and why. I will try today to explain to what to pay attention and which to select.
Internet provider for trading – speed of conection
Nowadays practically all Internet connections offered on the market are very fast. Therefore, the speed doesn’t already constitute a problem, at least when it comes to a large part of Poland. Generally, it is necessary to realize that if we want to trade on US Stock Markets, we must pay attention to connection with the located server (in my case) in New York. Even if I have a great connection within Poland, not necessarily the same will apply to the speed on U.S. server. It is quite obvious; we are talking about two different locations.
We connect with onet.pl, i.e. on the Polish servers (so it is my location):
We connect with nasdaq.com, i.e. on the U.S. servers:
Visible difference! Similarly is when we connect with the server of a given stock market, located in e.g. New York:
How to check the quality of internet connection
Nowadays practically all Internet connections offered on the market are very fast. Therefore, the speed doesn’t already constitute a problem, at least when it comes to a large part of Poland. Generally, it is necessary to realize that if we want to trade on US Stock Markets, we must pay attention to connection with the located server (in my case) in New York. Even if I have a great connection within Poland, not necessarily the same will apply to the speed on U.S. server. It is quite obvious.
If you choose the connection and you are able to check pings and tracerout – that’s great. If the supplier is able to send you ping from a long stretch than a few minutes – that’s even better. The best if you are able to receive data from the last 24h. This will give you an image, how many packs on the link you lose in a day.
How to receive such information:
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Start bar in Windows –> search –> type “cmd”
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In window which will appear you type: ping xxx.xxx.xxx.xxx-t (where xx.xx.xx.xx is IP number)
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Press enter and leave. When you want already to finish tests, you press “ctrl + c”
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You receive the following information:
The key is information included in red frames, i.e. how many packs you lose and the average time of ping. There are in fact some jumps, but the most important is that in a longer time the average was low. However, loss of packs is crucial, because thanks to that you know how the connection is stable.
Stability of internet connection is the most important
What stable means? Firstly, you don’t lose pack on the connection – i.e. you don’t have downtime in smooth functioning. For active traders, seconds or minutes are sometimes already an eternity. If at that time you have an open position on the variable value, very quickly the account balance can change to plus/minus. It would be a shame not to be able to close the position because of connection failure.
Fiber connection
To this day I have fiber connection in my office. Currently it is much cheaper than a few years ago. Generally, if you have the possibility of connecting to fiber connection, you should do it, because the quality of connection is definitely better. If no, find the supplier which is stable. I used to pay 400$ for fiber connection per month. Now I pay 60$ for the same quality of fiber connection. It is worthwhile sometimes to look for offers through the intermediary, rather than directly from the company providing such solution. It is much cheaper.
WIFI
You wanna trade or what? If yes, wifi is not right for you. You need stable internet connection with high quality. Wifi will not ensure it.
Summing up
Choose the Internet, which price is at reasonable level. Particularly if you just start your adventure on the market. It makes no sense to expose on costs. However, you should check its quality. Simply, the worst option is to lose because of technical problems that prevented closure of the position.
