When milisecond matters > LATENCY to your broker
Latency is the measure in time that it takes a bid to go from a VPS to a broker or liquidity provider. This critical lapse is measured in milliseconds.
Latency is the physical delay caused by the electrical signals passing through the various copper and fiber infrastructure that make up the core of communications networks. We measure it as the time it takes for a packet of information to reach your broker and come back. Ultra-low latency trading offers tremendous advantages for the trader because price quotes are received and orders entered before most other traders receive the same quote (usually several times over). This is most valuable during periods of volatile market activity when prices change quickly and latency may affect pricing. Low latency also offers the trader more reliable connectivity to the broker because there are fewer hops on the Internet for potential problems to impact the data transmission, requiring the data packet to be sent again at the expense of time.
Every broker has its server in different location, usually in Ney York, London or Amsterdam. Best of all is to rent VPS as close as possible to broker’s servers with latency lower than 5ms. To get better idea about VPS, brokers and latency, please check this table: LATENCY CHART.
There are many VPS providers out there. I personally use CNS VPS as their servers are very reliable and for affordable prices. I use 6 CNS VPS servers, 5 in New York and 1 in London.