Day traders require a couple of tools and services for them to do their jobs well. While most beginners in forex trading focus on the art of doing it and skills, these other tools are also essential since they facilitate and determine how well you can trade. Just as it is with any online job, it is critical to have a functional gadget and reliable internet. However, trading is a real-time thing as the markets tend to change every few seconds, which begs the question, how fast should my internet be for trading?
When assessing the best internet speeds, faster is always better, but does it mean that you should go for ultra-high speeds? It does not make sense as you only need speeds to load your web pages as fast as possible.
How fast should my internet be for trading?
Quick Answer
The minimum download speed you need for optimal trading is 1 megabyte per second.
The minimum upload speed that a day trader needs is 0.5 megabytes per second.
To dive deep into this matter and give you insight into how fast should my internet be for trading read on.
Why is internet speed important for trading
To make the best decision on which internet speeds suit you, it is prudent to understand a few things about these speeds and how they are tied to trading.
On a typical day in the trading world, thousands of data points are downloaded to your computer per second as the prices of assets vary. This way, your internet should support the continuous stream of this data.
If it is not fast enough, you will see some lag where you will be receiving data a few seconds late. In layman terms, you won’t see the latest data and will always experience a delay.
The unfortunate part is that you might not notice this delay, as you might still experience seamless streaming, but it goes a long way to affect your trading decisions.
When assessing internet speeds, look at the upload and download speeds to see if they are good enough for your trading software. You can do this using a couple of free internet speed testing tools available on the web today.
What is the Difference Between Upload and Download Speeds?
If you are not a tech guru, the chances are high that you might not be familiar with these terms.
They are used to define how fast you can send and receive data when connected to the internet.
Upload Speed
Upload speed shows how fast the internet is when sending information from your computer. It is prudent to have reliable upload speeds as they come into play when placing orders.
If there is a delay due to slow upload speeds, your orders will always lag, and you will find that the price points would have changed by the time the order is placed.
The recommended minimum upload speed that a day trader needs is 0.5 megabytes per second. However, it is not always good to be marginal with internet speeds as other things such as latencies and traffic might affect this speed and make it slower.
This way, having an internet connection with an upload speed of sat 3 megabytes per second will cushion you against all the unforeseen things that affect the speed.
Download Speed
Download speeds allow you to receive market data in a real-time fashion and make decisions based on that. This way, it is necessary to have good download speeds to assess the price of various assets and then trade.
Since you are receiving a lot of data when viewing the charts, for instance, and these prices are continually varying, it is necessary to have download speeds that are a bit faster than upload speeds. It is because of the amount of data downloaded when trading is more than that uploaded.
To put things into perspective, try, and picture a situation where you are logged into your trading software. Usually, you do not place orders frequently as you need to monitor how the points are changing before deciding which orders to place.
In some cases, people watch assets for hours before making orders. This way, most of the time in trading involves downloading data, a reason why your download speeds should be strong.
The minimum download speed you need for optimal trading is 1 megabyte per second. You should not experience any lag with this speed unless there are other issues with the connection.
Note that technology is susceptible to a couple of other letdowns and do not focus on the internet and forget other things that can affect your trading experience.
For instance, your internet service provider can experience downtime that will leave you disconnected. This way, it is prudent to find a reliable one or find a redundant internet link that will cushion you against such issues.
Ensure that your computer or gadget is powerful enough to support the trading software as good internet speeds will still lag in a slow computer.
How fast should my internet be for trading and other factors you need to consider
Most people worry if they can compete with big institutions that can afford the fastest internet speeds and use powerful computers for trading. Well, as much as trading requires a fast internet connection, the mentioned minimum speeds are good enough for any day trader.
How fast should my internet be for trading?
The minimum download speed you need for optimal trading is 1 megabyte per second.
The minimum upload speed that a day trader needs is 0.5 megabytes per second.
Note that once you can stream the information in real-time, boosting your internet speed won’t be any good. This way, all you need to ensure is that you are well above the mentioned minimum speeds, and even the big institutions won’t be a match for you.
However, do not forget about your device and the reliability of your internet service provider as they go a long way to determine the speeds you experience. Today, you are spoilt for options, and it is easy to get a cost-effective and strong internet connection that will do the job well enough.
